Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

TRENT RIVER AUTHORITY BILL (By Order)

Read a Second time and committed.

GREATER LONDON COUNCIL (GENERAL POWERS) BILL (By Order)

Order for Second Reading read.

To be read a Second time upon Tuesday next.

Oral Answers to Questions — DEFENCE

Language Training

Sir Gilbert Longden: asked the Minister of State for Defence why the teaching of languages has been discontinued at the Royal Military Academy.

The Under-Secretary of State for Defence for the Army (Mr. Peter Blaker): Language training is still available for those who stay on at Sandhurst and need it to prepare for university degree courses. It is preferable that young officers generally should concentrate during the limited amount of time available for initial academic training on subjects which are professionally essential to them. A wide variety of language training facilities will continue to be available as part of an officer's further education after leaving Sandhurst.

Sir Gilbert Longden: I am grateful to my hon. Friend for that answer, which is somewhat reassuring. It seems to be a strange time to discontinue language teaching just when we have entered the Community.

Mr. Blaker: I assure my hon. Friend that the new arrangements do not reflect any lessening of the importance that the Army attaches to the study of languages. They concern only the initial stages of training. Language training for officers will be one of the subjects to be studied by the independent committee set up by my right hon. Friend to review the education of officers.

Mr. Cormack: Will my hon. Friend ensure that advertisements for the Army are written in the English language?

Civil Research

Mr. Douglas: asked the Minister of State for Defence if he will list the research establishments under his control which have undertaken civil research work.

The Minister of State for Defence (Mr. Ian Gilmour): They are the Royal Aircraft Establishment, the National Gas Turbine Establishment, the Royal Radar Establishment, the Rocket Propulsion Establishment, the Royal Armament Research and Development Establishment, the Military Vehicles and Engineering Establishment, the Chemical Defence Establishment and the Microbiological Research Establishment.

Mr. Douglas: I thank the Minister for that reply, but he seems to have omitted the Naval Construction Research Establishment at Dunfermline and Rosyth which I understand has undertaken civil research work. In pursuit of his duties, will the hon. Gentleman try to persuade the Naval Construction Research Establishment to undertaken work in relation to underwater technology and vetting the stress work on production rigs and platforms for the North Sea?

Mr. Gilmour: As the hon. Gentleman will realise, the primary object of defence establishments is to do work connected with the defence programme, but when there is spare capacity they are glad to undertake work on civil projects.

Mr. Stonehouse: Is the policy to second civil servants to defence establishments intended to assist in the practical application as well as the original research and development?

Mr. Gilmour: As the right hon. Gentleman will know, most establishments are staffed by civil servants.

Expenditure

Mr. Frank Allaun: asked the Minister of State for Defence what proportion of the gross national product will be directed to military expenditure after including the 5 per cent. increase in real terms recently announced; what is the average proportion of other European NATO Governments; and how much money would be saved annually if Great Britain reduced to their average level.

Mr. Ian Gilmour: I have nothing to add to the reply I gave to a similar question from the hon. Member on 1st February.—[Vol. 849, c. 448–49.]

Mr. Allaun: Will the Minister confirm the reply given by his predecessor that if we reduced the share of the GNP we devote to armaments from 5·7 to 4·2 per cent.—the average for our European NATO allies—£600 million a year would be saved? Why should we spend more than any other European country? Would it not be wiser to cut back our expenditure rather than to incur the huge increase which we shall incur tomorrow?

Mr. Gilmour: The exact figures will appear tomorrow. As the hon. Gentleman knows, we do not spend more on defence than do the Germans. If we were to reduce expenditure, whereas there would be considerable savings in money there would also be considerable unemployment, particularly in the hon. Gentleman's area.

Sir Douglas Dodds-Parker: Does not my hon. Friend agree that if the figure of £600 million is correct, it is a small price to pay for a continuing contribution to the freedom of this country?

Mr. Gilmour: Of course, and it is obviously much more sensible to determine our defence expenditure not by what our allies do but by what our potential opponents do.

Mr. Crawshaw: Does the Minister agree that the NATO Powers generally are spending less money than are the Warsaw Pact countries, and that the Warsaw Pact countries continue to have a considerable preponderance in manpower and in all conventional weapons?

Mr. Gilmour: The hon. Gentleman is perfectly right. There is a preponderance

of force on behalf of the Warsaw Pact in Europe.

Weapons and Equipment

Mr. Farr: asked the Minister of State for Defence if he will reaffirm that it is his policy to equip the Armed Forces with British made weapons and materials to the greatest possible extent.

Mr. Ian Gilmour: Yes, Sir. It is Government policy as far as is practicable to procure defence equipment from British sources or in collaboration with our allies.

Mr. Farr: I am grateful for that reply. Will my hon. Friend put this policy into effect in terms of the new helicopter missile and will he do his utmost to see that the substantial orders for this equipment are passed on to BAC for its Hawkswing missile?

Mr. Gilmour: I have already given the House the general policy. All I can tell my hon. Friend is that the Hawkswing project is developing normally, but no final decision on this or any other project has finally been taken.

Mr. Marten: Are we to equip ourselves with the Poseidon and has a decision been taken about that? If so, may I congratulate the Government on strengthening the Anglo-American alliance?

Mr. Gilmour: That is a different question and I have nothing to add to what my right hon. Friend the Prime Minister said last week.

Mr. Peart: Is the Minister aware that the following item appears in today's Guardian:
The French Defence Minister, M. Debré, has confirmed that the decision of the British Government to buy its second generation nuclear weapons from the United States has made impossible a common British-French defence policy"?
That is extremely interesting, but can the Minister confirm or deny what has been stated?

Mr. Gilmour: It is not for me to confirm or deny what appears in the French Press or what the French Minister of Defence says, but as the right hon. Gentleman knows there are two other Questions on this subject on today's Order Paper.

Pensions and Gratuities (Northern Ireland Casualties)

Mr. Dykes: asked the Minister of State for Defence when he expects to announce the results of the review of pension and gratuity arrangements for military casualties in Northern Ireland and their dependants.

Mr. Ian Gilmour: Our general review of pension arrangements, including the benefits payable for injury or death attributable to service, is making good progress, but I am not yet ready to make a statement.

Mr. Dykes: In view of the time that has elapsed during the review, does my hon. Friend intend to endorse and confirm yet again that he and his colleagues will provide the most generous possible compensation by gratuities, lump sum payments or pensions to the widows and families of those killed or injured in Northern Ireland?

Mr. Gilmour: Of course I hope, as did my predecessor, that we shall be able to announce a good, fair and generous scheme for these people.

Major-General Jack d'AvigdorGoidsmid: Does my hon. Friend agree that we should pay tribute to the Lord Mayor of Belfast's fund which, following casualties in my regiment, has provided instant and generous donations?

Mr. Gilmour: Yes, I entirely agree with my hon. and gallant Friend.

Mr. Douglas: Will the Minister make it quite clear that we should give assistance to dependants who seek compensation from the Northern Ireland Criminal Injuries Board? It strikes me as unjust that people who have sustained bereavement in Northern Ireland have to go through the normal civil procedure without adequate assistance from the military authorities.

Mr. Gilmour: The hon. Gentleman is not being quite fair. Under the present procedure many of the dependants whose husbands have been killed have done quite well out of it and we provide assistance.

Low-Flying Aircraft (Malvern)

Sir G. Nabarro: asked the Minister of State for Defence whether he is aware that the Royal Radar Establishment at Malvern, Worcestershire, have now reactivated low-level flying tests, which prove detrimental in this area of amenity value and natural beauty; and whether he will direct such tests to cease forthwith, having regard to the rejection by ministerial staff of previous local complaints concerning the noise and loss of home comfort.

The Under Secretary of State for Defence for the Royal Air Force (Lord Lambton): There has been no significant change during recent years in the flying activities of the Royal Radar Establishment, Malvern, which are in any case only occasionally carried out at low level. There is, however, a considerable amount of RAF low-level training activity in the general area. This, as my hon. Friend will know, is essential to defence needs and must continue, though every effort is made to minimise the disturbance caused.

Sir G. Nabarro: Does not my hon. Friend realise that this is an area of special amenity and scenic value, is widely recognised as such and is closely protected by the Department of the Environment? Does he not appreciate that these constant depredations of the environment by his Department, both on the part of the Royal Air Force aerobatics team from Little Rissington and from the Royal Radar Establishment, are having very damaging effects on local residents? Can he improve the situation by inquiring further into the matter?

Lord Lambton: One is prepared to inquire further into the matter, but the truth is that areas of scenic beauty and natural wildness are the most suitable for low-level flying.

Mr. Hugh Jenkins: Would it not be possible to redirect these aircraft over Broadway?

Gibraltar

Mr. Greville Janner: asked the Minister of State for Defence what additional financial provision he proposes to


make for the defence Gibraltar in 1973, over and that made in 1972.

The Under-Secretary of State for Defence for the Royal Navy (Mr. Antony Buck): I cannot answer questions on defence expenditure for 1973 in advance of the publication of the White Paper.

Mr. Janner: When the Minister considers this expenditure, will he bear in mind the increasing hardship caused to the citizens of Gibraltar by the continued closure of the Spanish border? Will he further bear in mind the fact that the citizens of Gibraltar feel that on the whole they have been very poorly treated when comparison is made, for example, with the treatment accorded to the people of Malta who are infinitely more militant?

Mr. Buck: I have recently visited Gibraltar and I did not come away with that impression. Perhaps these are matters for my right hon. Friend the Foreign and Commonwealth Secretary rather than for me.

Royal Army Medical Corps Museum, Aldershot

Sir D. Dodds-Parker: asked the Minister of State for Defence what action he is taking to ensure that the Royal Army Medical Corps Museum at Aldershot, containing the Florence Nightingale relics, is adequately housed for inspection by the public and protected from the hazard of fire.

Mr. Blaker: We are planning to rehouse the museum as part of the rebuilding of the Royal Army Medical Corps Training Centre at Mytchett. Meanwhile suitable precautions are taken against fire in the existing building.

Sir D. Dodds-Parker: In view of the wide interest in this museum, will my hon. Friend look at the possibility of housing at least part of this collection in the Imperial War Museum, or even in the new part of St. Thomas' Hospital?

Mr. Blaker: I note my hon. Friend's point, but we must bear in mind that the Florence Nightingale relics are RAMC relics and it is right that they should remain in the corps museum where they are accessible to more members of the corps than if they were elsewhere.

Military Medal

Mr. Kelley: asked the Minister of State for Defence if he will invite by public announcement on television and other media all persons awarded the Military Medal prior to September 1939 to register with his Department.

Mr. Blaker: No, Sir.

Mr. Kelley: Is the Minister aware that this question has now become rather jaded and that it is not a political matter —because the answer we have received today is the same as that given by the previous Government, and the answer given by the previous Government was the same as we received from the Government before that. Is he aware that, compared with the total of defence expenditure, the price of dignity for this nation is a paltry few pounds? To give these men £20 a year to buy a new suit to wear at the armistice celebrations would not bankrupt us, and probably the fact that we are treating our people like this has a lot to do with why we are spending less than the Warsaw Pact countries on defence.

Mr. Blaker: I do not accept the implication of the last part of that supplementary question. The facts are that when it was decided in 1945 to extend the gratuity of £20 to those who won the medal in the 1939–45 war the decision was then taken that the award could not be back-dated beyond that. One reason was that it would have been impracticable to trace all the 116,000 people who were awarded the medal in the 1914–18 war. If that was the decision at that time, it is difficult to see how, 28 years later, one could reverse it.

Major-General Jack d'Avigdor Goldsmid: Does my hon. Friend agree that the gaining of a decoration of this sort lies in the honour and not in the financial reward?

Mr. Blaker: I entirely agree with that valid comment.

Mr. Kelley: I am completely dissatisfied with the Minister's reasons for rejecting this request. We now have a medium which was not available in those days, and I should like the hon. Gentleman to consider finding out what is the total cost to the nation involved in


buying dignity and giving to people who served this country in the 1914–18 war the same rewards as those who served us in the Second World War.

Mr. Blaker: The total cost, so far as can be estimated, would be about £450,000 for the gratuities, plus £130,000 a year for those who would receive an addition to their pension. But that is not the point. The point is that this is not a practicable suggestion. It is more complicated than the hon. Gentleman seems to realise because also involved would be the question whether the award would be paid as it was for those who died in the 1939–45 war, namely to the heirs of those who have won the medal.

Fuses (Leitch Report)

Mr. James Lamond: asked the Minister of State for Defence if he will make available to interested parties the Leitch Report.

Mr. Blaker: The report of the internal working party on fuses contains a good deal of commercially confidential information and cannot be distributed outside Government circles.

Mr. Lamond: Is the Minister aware that his reply will cause considerable disappointment among the executives of the firm in my constituency which is concerned with this matter, because it will be difficult for them to plan their future operations since they do not have sufficient knowledge of the Government's intentions? Will he consider at least assisting the employment situation in my constituency by making sure that my constituents may be a little more certain about their future by letting the firm have certain information to assist in forward planning?

Mr.Blaker: I am aware of the interest of the firm in the hon. Gentleman's constituency. As my hon. Friend told the House on 1st February, a decision on the future of fuse development and production will be announced shortly.

Weapons (European Standardisation)

Mr. Tebbit: asked the Minister of State for Defence what progress has been made towards the agreement on common operational requirements for weapons systems in Western Europe.

Mr. Cronin: asked the Minister of State for Defence what progress is being made in the standardisation of defence equipment for European NATO countries.

Mr. Ian Gilmour: We and our allies have undertaken to launch no major new equipment programmes without determined efforts to agree common requirements and co-operative procurement. A number of projects, still at the formative stage, are under discussion and in some cases an important measure of agreement has already been reached with our European allies.

Mr. Tebbit: Does my hon. Friend agree that if Europe is to become capable of defending itself independently and at reasonable cost, a common requirements system is an absolute necessity? Will he lose no opportunity to make it plain to our Armed Services that they should think seriously about whether they will get any of the equipment they want unless they can agree upon common operational requirements?

Mr. Gilmour: I would largely agree with my hon. Friend, as will the Services, because, faced with increasing costs and shorter production runs, it is obviously not only sensible but essential to increase collaboration among allies.

Mr. John Morris: What thought has been given, for example, to successes of the Chieftain tank in this country and the Leopard in Germany? Is not the hon. Gentleman aware that one of the major stumbling blocks has been the difference in philosophy in this country on armaments and in Germany on mobility? Will he ensure that the general staff, certainly in this country, are made deeply aware that there will be a strict limitation of the money that is available unless they come to terms with the operational requirements of other countries in Europe?

Mr. Gilmour: The right hon. Gentle man is perfectly right. There have been differences of approach on various equipments between us and other countries. But the general staff and other staffs do not need any telling that collaboration is the best way of securing these equipments in the future, and they are well aware of this.

Rear-Admiral Morgan-Giles: Does my hon. Friend realise that with such collaboration it might take even longer to get equipment and that if it takes even longer to get something like the Harrier we shall never get it at all?

Mr. Gilmour: Collaboration has its snags and disadvantages, but they are nothing like as great as the advantages to be gained from it.

Australia and New Zealand

Rear-Admiral Morgan-Giles: asked the Minister of State for Defence whether he will make a statement on the results of his recent discussions with the Governments of Australia and New Zealand concerning the five-Power ANZUK force.

Mr. John Morris: asked the Minister of State for Defence if he will make a statement on the recent visit to Australia of the Secretary of State for Defence.

Mr. Ian Gilmour: My right hon. and noble Friend the Secretary of State for Defence had useful discussions with the Governments of Australia and New Zealand on a number of topics, including political and defence problems in South-East Asia. These Governments confirmed their intention of honouring the terms of the five-Power defence arrangements so long as Malaysia and Singapore wish them to continue. The Australian Government intend to withdraw their battalion and battery from the ANZUK Brigade at about the end of this year; but the New Zealand Government intend to maintain their present contribution, and my right hon. and noble Friend confirmed that Britain will also continue to do so. The detailed implications of the Australian decision for the ANZUK Brigade will now be worked out in consultation, as necessary, between all the partners in the five-Power arrangements.

Rear-Admiral Morgan-Giles: Will my hon. Friend assure the House on two points: first that the Government really intend to continue the firmest possible defence links with Australia and New Zealand, and secondly that the Government continue to realise the importance of peacekeeping forces in the area east of Suez?

Mr. Gilmour: I agree entirely with my hon. and gallant Friend. I think that

both of those points were implicit in my original answer.

Mr. Morris: Is not a rather odd situation created when the Australians withdraw a major battalion, which is a major factor of the ground forces in Singapore and Malaysia? What really is left then of the command structure headed by an Australian admiral? Will that continue? Is not the Minister aware that the Secretary of State for Defence seemed to be surprised when he was told that the Australians were keeping only 600 supply troops in Singapore after the end of this year, and will not this so-called five-Power agreement be as dead as the dodo within 18 months?

Mr. Gilmour: I do not know why the right hon. Gentleman has always had this strong prejudice against the five-Power agreement. I should have thought that so long as Malaysia and Singapore want the agreement to continue, it is in their interests and in the interests of this country that it should continue.
There is no hurry in working out the future logistic forces because the Australians are only withdrawing their battalion at the end of the year and they will leave some logistic troops at that time. There is plenty of time to make arrangements.

Mr. Wilkinson: Is not a very major part of the Australian contribution the air defence element at Butterworth? So lona as they maintain their Mirage squadrons there, will not that continue?

Mr. Gilmour: My hon. Friend is absolutely right, and they have every intention of keeping their squadrons there.

Nuclear Deterrent

Mr. Barnes: asked the Minister of State for Defence what estimates he has made of the cost of replacing Great Britain's Polaris missiles with the American built Poseidon system.

Mr. Wall: asked the Minister of State for Defence if he will make a statement on the future of the British nuclear deterrent.

Mr. Dalyell: asked the Minister of State for Defence what discussions he has had with the United States of America on British acquisition of the Poseidon missile.

Mr. Ian Gilmour: I have nothing to add to the replies which my right hon. Friend the Prime Minister gave to the hon. Members for Brentford and Chiswick (Mr. Barnes), and Salford, East (Mr. Frank Allaun) on 6th February.—[Vol. 850, c. 221, 223.]

Mr. Barnes: In view of the huge cost of equipping our four submarines, which is estimated at over £250 million, will the Minister resist the pressure from the Royal Navy for Poseidon? Is not the best defence for the enlarged Community to have strong conventional forces and for Britain and France to phase out their nuclear deterrents?

Mr. Gilmour: I certainly do not agree with the second part of the hon. Gentleman's supplementary question. The two things are not mutually exclusive. As to the first part, as my right hon. Friend said the other day, maintaining the effectiveness of the Polaris forces is a continuing process.

Mr. Wall: Without considering the possibility of acquiring the Poseidon systerm, will my hon. Friend consider the possibility of jumping a generation of weapons and discussing with the Americans the possible acquisiton of the Trident system?

Mr. Gilmour: No decision has been taken. We do not make announcements on particular equipments that are under consideration. My hon. Friend will not expect me to go into detail on this matter.

Mr. Dalyell: What exactly does the Minister mean by saying that "the two things are not mutually exclusive"?

Mr. Gilmour: The hon. Member for Brentford and Chiswick (Mr. Barnes) appeared to imply that either we had nuclear forces or we had effective conventional forces in Europe, and I was saying that it was right to have both.

Mr. Marten: As my right hon. Friend referred to a previous answer, which I cannot recall, will he say what is the position about purchasing Poseidon?

Mr. Gilmour: The position is as I have said: that my right hon. Friend the Prime Minister has said that we have the nuclear deterrent and we intend to maintain it. We keep the effectiveness

of our Polaris submarines under continual review.

Mr. Peart: I quoted earlier from The Guardian, a British newspaper, giving an account of M. Debré's attitude. There is uncertainty and, therefore, the House ought to know whether a decision is to be made. This is a very important decision. It may be a right decision or a wrong decision. At least we want to know the facts. Will the Minister say when a decision will be made and when an announcement will be made to the House?

Mr. Gilmour: All I can tell the right hon. Gentleman is that we are not now at the point of decision.

United States of America (Purchase of Equipment)

Mr. Stonehouse: asked the Minister of State for Defence what representations have been made by the Defence Sales Department to the United States authorities regarding the United States Defence Appropriations Act for the fiscal year 1973 which contains an amendment prohibiting the purchase of equipment containing a specified range of foreign produced speciality metals and which amendment would effectively prevent many United Kingdom aerospace exports to the United States Department of Defence.

Mr. Ian Gilmour: Since the amendment was first proposed we have repeatedly made our views knows to the United States administration. We have strongly urged them to secure the repeal of this additional obstacle to trade between the United States and the United Kingdom.

Mr. Stonehouse: Is not this amendment, which did not have the support of the American administration, one of the worst examples of protectionism and will it not do a great deal of harm to British exports to the United States during the period when it is in force? What estimate has been made of its effect? What steps are being taken to ensure that certain military aircraft sales in particular are not affected by the amendment?

Mr. Gilmour: As the right hon. Gentleman has said, this is a highly protectionist amendment. That is why we have urged its repeal. But I assure the right hon.
Gentleman that the sale of Harrier aircraft is not affected by it.

Mr. Tebbit: Will my hon. Friend assure the House that the effect of the amendment will be borne in mind when consideration is being given to whether we should negotiate with the Chinese Government to sell to them military equipment, which it is generally believed they are interested in purchasing here?

Mr. Gilmour: My hon. Friend will agree that that is quite another question.

Polaris Submarines (Accidents)

Mr. Hugh Jenkins: asked the Minister of State for Defence how many accidents have taken place with Polaris submarines.

Mr. Ian Gilmour: Apart from the deliberate destruction of a Polaris test missile on 13th February, there was a minor collision between HMS "Renown" and the motor vessel "Moyle" in 1969.

Mr. Jenkins: Will the Minister clarify the extraordinary written answer that he gave on Friday to one of my hon. Friends in the first part of which he said that the test had been a failure and in the second part that it had been successful? What did he mean?

Mr. Gilmour: There is no possible confusion in what I said originally. The missile itself was fired successfully by the submarine, but in flight something went wrong—we do not know exactly what—and that is what I told the hon. Gentleman's colleague.

Rear-Admiral Morgan-Giles: To prevent any misunderstanding of the word "accidents" in this connection, will my hon. Friend make it clear that the Polaris submarines have been outstandingly safe and successful and also that the one recent malfunction caused no risk of any nuclear hazard?

Mr. Gilmour: As my hon. and gallant Friend says, the Polaris submarines are extremely safe and their record on missile firings up to now has been very good. I need hardly bother to assure the House that there was of course no nuclear warhead in that missile.

Mr. Dalyell: The answer about the "Repulse" referred to by my hon. Friend

was a bit confusing, since it was said that the fault was not the fault of the personnel or of the equipment. Whose fault was it?

Mr. Gilmour: That is something we are seeking to find out.

Oral Answers to Questions — EMPLOYMENT

Equal Pay

Mr. William Hamilton: asked the Secretary of State for Employment whether he has completed his inquiries into the new evidence, reported in theSunday Timesof 4th February 1973 of the methods being employed by certain employers to evade their responsibilities in implementing the Equal Pay Act.

The Minister of State, Department of Employment (Mr. R. Chichester-Clark): The report on equal pay by the Office of Manpower Economics, published in August 1972, stated that it had
found only a very few examples of employers who were deliberately taking action designed to circumvent the Act.
I have no reason to question this assessment of the general situation.

Mr. Hamilton: Is the hon. Gentleman aware that that reply is very unsatisfactory? I know he is aware of the report in the Sunday Times mentioned in the Question, that the Paper Box Federation, for instance, is taking what are called differential-preserving stratagems to avoid implementation of the Equal Pay Act and that members of the Engineering Employers' Federation are getting guidance on similar lines. One of the results is that men's lavatory attendants, for instance, are getting £3 a week more for doing more or less precisely the same job as attendants in women's lavatories. That is the kind of way in which the employers are seeking to evade their responsibilities under the Act. Will the hon. Gentleman take this matter more seriously than he appeared to do in his answer?

Mr. Chichester-Clark: I have a feeling that my fault is in having taken the matter so seriously that I acknowledged that I was taking a close and personal interest in it. As for the papers issued by the Engineering Employers' Federation, they were issued in September 1970,


December 1970 and July 1971. In that respect they do not represent new evidence and the effect of the guidance which they gave will have been fully taken into account by the Office of Manpower Economics study. The documents were not concerned with advice about evasion of the Act so much as with containing the cost.

Dr. Summerskill: Have the Government taken any steps to discourage such so-called guidance being sent out by the Engineering Employers' Federation—or, indeed, by any other employers—so that, instead of simply keeping an eye on the results of such guidance, they discourage the practice altogether?

Mr. Chichester-Clark: In fairness to the engineering employers, the document, which is unhappily labelled "confidential", should be read in full. Perhaps the best way of bringing about the situation which the hon. Lady wants is that there should be publicity for the Act. The Department is mounting an intensive campaign in this respect. It will be launched shortly with the publication of a booklet to give employers advice on the implementation of equal pay.

Mr. Harold Walker: Is the Minister aware that there is growing disquiet about the Government's complacency and indifference on this matter and that the Counter-Inflation Bill now in Standing Committee acts as a positive encouragement to employers to evade the requirements of the Act? Is he not aware that the report of the Office of Manpower Economics reveals that the average earnings of female manual workers are less than 50 per cent. of those of male manual workers and that the permissive provisions of the Counter-Inflation Bill will at best provide for a proportion of only 65 per cent. on average by the end of this year, in contrast to the 90 per cent. which was hoped for by the Equal Pay Act?

Mr. Chichester-Clark: But the truth of the matter is that this Question really arises from the fact that I showed too overtly a personal and keen interest in this matter. That was why the hon. Member put it down.

Mr. Hamilton: indicated dissent.

Mr. Chichester-Clark: I therefore reject any suggestion of complacency on the part of the Department. As for the Counter-Inflation Bill, the hon. Member knows very well that improvements in equal pay can be made.

Oral Answers to Questions — SOCIAL SERVICES

Service Disability Pensions

Miss Fookes: asked the Secretary of State for Social Services if he will change the rule whereby a service disability pension is awarded from the date of a successful application or appeal so that pensioners receive payments backdated to the date of their discharge on grounds of disability.

The Under-Secretary of State for Health and Social Security (Mr. Michael Alison): This rule is the counterpart of our readiness to accept that claims for war pensions can be made or reviewed without any time limit whatsoever. It follows from this that there cannot be unlimited liability to pay arrears, and my right hon. Friend exercises his discretion under Article 65 of the Royal Warrant to backdate awards only (i) where the pensioner has been prevented by physical or mental incapacity from making his claim or appeal earlier (ii) where there has been departmental error or misdirection. The Parliamentary Commissioner for Administration has accepted this practice as reasonable.

Miss Fookes: But I do not accept it. Would not my hon. Friend agree that there are many cases between mental and physical incapacity, as in the case of one of my constituents who suffered a certain intellectual limitation, got into a muddle and was finally rescued by the British Legion? Is not this a somewhat mean way for the Department to act?

Mr. Alison: We must have some sort of guideline or rule, but if my hon. Friend likes to send me details of that case I will scrutinise them personally.

Mr. Leadbitter: Will the Minister bear in mind that there are many examples of awards being made in other respects for injury and disability retrospectively, that in this kind of case a good deal of time is spent in processing it and that months and sometimes even years might elapse? Surely it is wrong that, once


an award is given in favour of the person concerned, he should be deprived of any benefit for the period which has elapsed.

Mr. Alison: The hon. Gentleman knows, I think, that the fact that there is no time limit whatsoever to claims is a marked advantage for the war pensioner. Indeed, in 1971 we made 120 awards for injuries arising from the 1914–18 war. Therefore, the fact that there is this opportunity, in addition to back-dating, seems to me a reasonable and fair provision.

Hospital Service (Apprentices)

Mr. Tilney: asked the Secretary of State for Social Services how many apprentices in trades needed by the hospital service have been taken on in each of the last three years in development areas.

Mr. Alison: Information in the form requested is not readily available. Following are particulars of respectively apprentices in hospital building and engineering maintenance trades and trainee cooks in post on 30th September 1972: Newcastle area 27 and 42; Liverpool area 18 and 11; and South Western area 11 and 31.

Mr. Tilney: Are not these figures rather small? Would it not be possible to take on more apprentices, especially in such areas as Merseyside, where there is so much unemployment among youth?

Mr. Alison: The need for trainees and apprentices obviously varies according to local requirements and is determined by hospital authorities. It would be wrong to take them on if there was no real work for them to do, simply in response to unemployment figures. However, I will weigh what my hon. Friend has said and direct his inquiries to the regional hospital board.

Mr. Loughlin: Is it not true that the inability to attract apprentices to the hospital service derives mainly from the miserable wages they would receive on completion of their apprenticeship? Before we look at apprenticeships in the hospital service, would it not be better to look at the general wage levels in the service?

Mr. Alison: That is another question and one which, as the hon. Gentleman will know from his previous occupation

of my post, falls to the relevant Whitley Council.

Pakistani Doctors

Mr. Cyril Smith: asked the Secretary of State for Social Services whether he will cause inquiries to be made as to the number of Pakistani doctors who entered Great Britain when Pakistan was in the Commonwealth but have subsequently been refused full registration as doctors, due to Pakistan leaving the Commonwealth between their entry to this country and registration; and if he will also explain why similar regulations do not apply to doctors from South Africa.

Mr. Alison: As I explained in my reply to the hon. Member on 30th January, the entitlement of overseas practitioners to full registration depends, first, on the existence of an order applying Part III of the Medical Act 1956 to the country of origin. An order reapplying these provisions to South Africa after its departure from the Commonwealth was made in 1962—the Medical Practitioners (Republic of South Africa) Order 1962, Statutory Instrument 1962 No. 1090.
I regret that the information asked for in the first part of the Question could not be obtained, if at all, without disproportionate cost.—[Vol. 849, c. 371.]

Mr. Smith: When does the hon. Gentleman propose to make for Pakistan a similar order to that for South Africa to which he has referred? How soon may we expect such an order to be made? Does he agree that the best qualification for a doctor is that which he has obtained rather than his country of origin or the colour of his skin? Does not the Minister understand that some of us find it extremely strange that a doctor from a country which apractises apartheid should be recognised while a doctor from a multi-racial country is not?

Mr. Alison: I think the hon. Gentleman knows that we were able to make a rapid application of the order relating to South Africa because we had some notice of its impending withdrawal from the Commonwealth.
The answer to the first part of his supplementary question is "As soon as


practicable", and I hope soon. There is nothing to prevent doctors seeking temporary registration which enables them to fill hospital posts. This is what the relatively few doctors affected by the Pakistan limitation are doing.

Mr. Fletcher-Cooke: Is not a serious principle involved in this question, namely, the skills of the doctors concerned? Is it not the fact that the General Medical Council has got into the mess that it has because it has not examined the individual skills of the doctors but has taken blanket qualifications in the place of origin?

Mr. Alison: The qualification that a man holds has to be recognised by the General Medical Council as one of the conditions for obtaining employment here. Furthermore, a practitioner who satisfies all the necessary qualification requirements of the 1956 Act will not be granted full registration straight away unless he can also show that he has acquired acceptable experience—generally a year in a hospital.

Mr. Stonehouse: Does the hon. Gentleman accept the principle that although Pakistan must certainly suffer the disadvantages of its unwise decision to leave the Commonwealth, the disadvantages should not be applied to individual Pakistanis who were in this country prior to that decision?

Mr. Alison: I recognise that we want to do everything possible to apply the inexorable processes of law with due humanity; but, as I said to my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke), in practice there is nothing to prevent Pakistani doctors who are caught in this way seeking temporary registration as a perfectly viable way out of the predicament, whilst continuing to work in hospitals until this business is cleared up.

Sir J. Rodgers: Apart from the qualifications of doctors from abroad, may I ask my hon. Friend whether due regard is paid to their knowledge of English?

Mr. Alison: One of the present requirements is that somebody coming from overseas to practise medicine in this country must satisfy the basic requirements of competence and ability to communicate by working, if necessary, for up to a year in a British hospital.

Oral Answers to Questions — NORTHERN IRELAND

Security Operations

Mr. Biggs-Davison: asked the Secretary of State for Northern Ireland whether he will make a statement on operations in Northern Ireland.

The Under-Secretary of State for Northern Ireland (Mr. Peter Mills): There were a number of violent incidents earlier this month, particularly in Belfast, which were well contained by the security forces. Since then the level of violence has been generally reduced, although in Belfast bombing and shooting incidents have continued. The security forces continue to mount patrols and to make selective searches and arrests in both Catholic and Protestant areas.

Mr. Biggs-Davison: While the security forces deserve the congratulations of this House for the fall in the level of violence as a result of scoring considerable successes, is there not concern at the flow of not only Eastern bloc but American arms to the IRA? Is this matter being dealt with at the highest level?

Mr. Mills: My hon. Friend is absolutely right. There have been considerable successes recently. Since the beginning of this month 53 Catholics and 32 Protestants have been arrested and charged with serious security offences. The other matter mentioned by my hon. Friend is being watched very carefully indeed.

PRIME MINISTER OF JAPAN

Mr. Norman Lamont: asked the Prime Minister what plans he has for a meeting with the Prime Minister of Japan.

The Prime Minister (Mr. Edward Heath): Mr. Tanaka has accepted an invitation to visit the United Kingdom this year. No date has yet been fixed.

Mr. Lamont: As the Japanese balance of payments surplus is one of the main causes of the recent international monetary crisis, may I ask my right hon. Friend to impress upon the Japanese Government that the revaluation of the yen will not necessarily be enough to restore stability to the situation, that it remains highly desirable that import restrictions should be liberalised, that the Japanese


export control programme should continue and that it is time Japanese promises were matched by action?

The Prime Minister: As the yen is at present floating it is difficult to say at which point it will finally be repegged. Part of the arrangement was that the dollar should be devalued and that the yen should float. I agree with my hon. Friend on the second part of his supplementary question, and I impressed this on Mr. Tanaka when I saw him in Tokyo last September. It is equally important that the whole system of selling in Japan should be opened up to others. Our exporters find great difficulty in getting capital into Japan to establish any form of selling institution and thus get their proper share of the Japanese market.

Mr. Maclennan: Regarding export control, will the Prime Minister undertake to approach Mr. Tanaka when he is in this country about the flagrant violation of sanctions in Rhodesia by Japanese salesmen? Will he bring this point urgently to the attention of the Japanese?

The Prime Minister: I will certainly consider what the hon. Gentleman has said. However, as he knows, responsibility for the implementation of the sanctions regulations rests with the United Nations.

Sir D. Renton: Would it not help the Japanese to overcome some of their balance of payments surplus difficulties if they increased the amounts that they give to Far East ex-prisoners of war?

The Prime Minister: That is a separate question. If I recollect—I should have to check this matter—I believe that there was an original settlement which was very helpful. But, diverting from that, if there were more Japanese investment in developing countries that also would help.

COUNTER-INFLATION POLICY (PRIME MINISTER'S SPEECH)

Mr. Skinner: asked the Prime Minister if he will place in the Library a copy of the public speech made by him to the Young Conservatives at Bournemouth on 4th February on Government policies.

Mr. Bruce-Gardyne: asked the Prime Minister if he will place in the Library a copy of his public speech at Bournemouth on 4th February on prices and incomes policy and industrial investment.

Mr. Molloy: asked the Prime Minister if he will place in the Library a copy of his public speech to the Young Conservatives Conference on 4th February on prices and incomes.

Mr. Carter: asked the Prime Minister if he will place in the Library a copy of his public speech made at the Young Conservative conference in Bournemouth on 4th February on prices and incomes.

Mr. James Lamond: asked the Prime Minister if he will place in the Library a copy of his public speech to the Young Conservative conference on 4th February on prices and incomes.

Mr. Ewing: asked the Prime Minister if he will place in the Library a copy of his public speech to Young Conservatives at Bournemouth on Sunday 4th February on prices and incomes.

Mr. Duffy: asked the Prime Minister if he will place in the Library a copy of his speech to the Young Conservative Conference at Bournemouth on 4th February on the Government's counter-inflation policy.

Mr. William Hamilton: asked the Prime Minister if he will place in the Library a copy of the public speech he made to the Young Conservatives at Bournemouth on 4th February on prices and incomes policy.

Mr. Meacher: asked the Prime Minister if he will place in the Library a copy of his public speech to the Young Conservative conference at Bournemouth on 4th February on his economic policies.

Mr. Walter Johnson: asked the Prime Minister if he will place in the Library the speech he made to the Young Conservatives at Bournemouth on 4th February on his counter-inflation policy.

The Prime Minister: I did so on 7th February, Sir.

Mr. Skinner: I have read it again. Does the Prime Minister recall telling


the Young Tories that he would like to he more generous to particular groups? Was he referring to people like himself who are on £15,000 a year and are to get a £6-a-week increase on All Fools' Day? If such people can get increases of that order, why cannot gas and hospital workers and pensioners who are fighting for a decent standard of living?

The Prime Minister: The hon. Gentleman knows that the salaries of both Members and Ministers are fixed by Parliament. I was referring to the fact that the present Government have an undisputed record of helping the deprived groups in our community, in particular the old-age pensioners, in a way that they have never been helped before.

Mr. Carter: In that speech the Prime Minister referred to the priority attached by the Government to British investment. If at sometime in the future British investment in the Common Market is running at such a level that it places investment at home in jeopardy, what action could the British Government take to redress that situation?

The Prime Minister: I am glad to say that all the indications now are that investment, long delayed thought it has been, is greatly improving. The CBI, the DTI and other forecasts substantiate that. Concerning Europe, I do not visualise the position mentioned by the hon. Gentleman. If that situation arose it could be considered with the Community as a whole with either the Council of Ministers or the Commission. Surely the right thing is to make investment here attractive so that it can find suitable opportunities.

Mr. Bruce-Gardyne: My right hon. Friend referred in his speech to manufacturers looking for black clouds in the sky to deter them from investment. Surely they do not have to look very far, bearing in mind the calamitous decline in the real rate of return on investment over the past decade or more. Is it not a fact that the shareholders of ICI, for example, would have been far better served if every penny spent by the managers of ICI on plant and machinery in the early 1960s had been invested in land instead? Is a restriction of profit margins related to five fairly calamitous years a yardstick which is likely to disperse the clouds?

The Prime Minister: As I have said, all the forecasts for investment are greatly improving. The reason is that the manufacturers say that what has deterred them from investment has been the rate of inflation and the threat of inflation, and their belief that the Government's present policies will deal with these problems is giving them more confidence for investment.

Mr. Lamond: Does the Prime Minister recall that in that speech he also said, referring to wage claims, that of course there were hard cases with which it was easy to sympathise? Why does he find it so easy to make exceptions, in the case of price increases and so difficult to exercise that sympathy for hard cases when it comes to allowing wage increases during the freeze?

The Prime Minister: Very few exemptions have been made for price increases. That is borne out by the fact that right across the range of manufactured goods, including manufactured foods, the difference between the monthly indices was 0·2 per cent. and has been at that figure for two months running. That shows how effective the standstill has been right across the range of manufactured goods and manufactured foods.

Mr. Ewing: With regard to that part of the Prime Minister's speech in which he criticised those members of his own party who believe in the freedom of market forces, is it not true that that was the economic policy on which his Government were elected and that the Government are in such a mess not because of the excessive wage demands of trade unionists but because of the worst economic mismanagement this country has ever been subjected to by any Government?

The Prime Minister: I cannot agree with the hon. Gentleman. As the Trades Union Congress has told us that it also believes in a free market economy, it should be possible to have it if agreement can be reached between the TUC, employers and the Government on how it is to be managed.

Mr. Tugendhat: My right hon. Friend also referred to rates. Does he agree that today's announcement by the Greater London Council shows how much more successful Conservative-run councils are than Labour-run councils in safeguarding


the interests of the ratepayers? What progress has been made in his discussions on the subject?

The Prime Minister: I have told the House that we are examining the various aspects put to us by the cities and the local authority associations. I agree with my hon. Friend, having seen the announcement about the GLC, that it is commendable that it should be asking for an unchanged rate for the second year running. I hope that other local authorities can do the same.

Mr. Harold Wilson: With regard to the gas dispute, the Secretary of State for Employment has made clear his willingness to take action before 1st April by appointing members of the Pay Board, including at any rate the component for dealing with particular cases and problems. Will the Prime Minister now consider a development of what his right hon. Friend has said?
Does he recall that when we set up the Prices and Incomes Board, in order to give it the necessary powers in advance of legislation, we created it as a Royal Commission so that it could get down to work right away? Will he agree to set up either a nucleus of the Pay Board or at least the component dealing with special cases or particular problems as a Royal Commission, and then in the gas dispute enable it to embark in relation to phase 3 settlements—[HON. MEMBERS: "Too long."]—on the thorough-going inquiry suggested by Sir Henry Jones last week, which would take into account the whole productivity record—[HON. MEMBERS: "Speech."]— and the problem of the electricity analogue, which was slipped through before the standstill phase I agreement—[Interruption.] Tory backbenchers are bad enough—[Interruption.]

Mr. Speaker: Order. The right hon. Gentleman is asking a serious question.

Mr. Wilson: Yes, Mr. Speaker, and it is one to which the Opposition want a serious answer. I was just completing my question, and I want the right hon. Gentleman to hear it.
I was asking the Prime Minister whether the Pay Board could then go on to the gas inquiry as suggested by Sir Henry Jones, including the electricity analogue—[Horn. MEMBERS: "Too

long."] I could have finished 10 minutes ago but for the interruptions of Conservative back-benchers. I am asking a serious question which the Prime Minister must answer.
Recalling, as I said when I was interrupted before, that the Government are insisting on the matter coming into phase 3, as Sir Henry Jones requires, will the right hon. Gentleman on that basis consider this suggestion?

The Prime Minister: I have listened carefully to what the right hon. Gentleman has said. He will not expect me to answer such a question without careful consideration. What my right hon. Friend the Secretary of State for Employment said was that the appointment of secretaries of the board can be made at once, because they are members of the service and therefore available and in the Government's employment, and that the union was therefore perfectly able to present whatever material it wished. That could then be handled, and we should appoint the board at the earliest constitutional opportunity. That gives the union, or any others that wish—because the flatter cannot be considered solely on the basis of any one industry or union—the opportunity to prepare the material and hand it in.
On the question of the inquiry, what is important is that the board should be able to examine the claims for exemption or exception from all those who wish to raise them, and not consider one in isolation. I think the right hon. Gentleman will agree from his own experience that it is the examination by a different select group in isolation of a particular application that has so often led to leapfrogging and then to inflation.

Mr. Wilson: I am grateful to the Prime Minister for that reply. Of course, that was what the Prices and Incomes Board was for; it required powers. Is the right hon. Gentleman aware that I am proposing that instead of waiting for legislation by 1st April the Pay Board should be given powers to start on the job now? As he probably could not hear all I said, because of the twittering of the clowns behind him, if I send him an elaboration of the proposal tonight will he, as he has offered, give consideration to it?

The Prime Minister: Of course, I always give consideration to anything the right hon. Gentleman puts forward. But I must re-emphasise that what my right hon. Friend the Secretary of State for Employment has already proposed offers everything the union can reasonably ask for in consideration of its proposals or claims so that they can be implemented in the autumn in stage 3.

CANCER RESEARCH

Mr. Greville Janner: asked the Prime Minister whether, in view of his foreword to Lord Zuckerman's report on cancer research, he will make a further statement on the implications of that report.

The Prime Minister: I said in the foreword to Lord Zuckerman's report that the Government would welcome the views of the Co-ordinating Committee for Cancer Research and the Standing Medical Advisory Committee's Sub-Committee on Cancer on whether there was scope for further action. I have just received the views of the first body and I await those of the second. I shall not be in a position to make a statement until the implications of these views have been studied.

Mr. Janner: Does the Prime Minister agree that the figure of £10 million shown in the report as allegedly spent on research directly related to cancer is pathetically low? Is he aware that the accounts of the Imperial Cancer Research Fund show that even that figure is a considerable exaggeration? As he lent his name to the report, will he order an inquiry into the figures now?

The Prime Minister: The hon. and learned Gentleman, having studied Lord Zuckerman's report, will recognise that Lord Zuckerman said that research could not absorb a great increase in the finance available at one go. He suggested that there should be a steady improvement in the amount of money available.
There are other limiting factors such as those of sufficient training and capability to engage in research. This is one of the points which have been raised already and to which we are giving consideration.

QUESTIONS TO MINISTERS

Mr. Stonehouse: On a point of order, Mr. Speaker. Has it occurred to you that a number of Opposition Members whose Questions to the Prime Ministers were linked with No. Q2 were not allowed to ask supplementaries? Increasingly we discover that only a few of the Questions put down to the Prime Minister are reached for reply in the House. As the number of Questions to the Prime Minister is now at least as great as that to any other Minister, ought not consideration to be given to the Prime Minister's Questions being taken at three o'clock instead of at 3.15 p.m.?

Mr. Speaker: That is not a matter for me. It is a matter for discussion between the usual channels. I thought that I might get into trouble today. I carried out the wish of the Select Committee on Parliamentary Questions which said in paragraph 25 of its report:
… they hope that Mr. Speaker will exercise his discretion in limiting the number of supplementary Questions arising from identical Questions irrespective of when the Questions were originally tabled.
I have followed that advice.

Sir F. Bennett: Further to that point of order, Mr. Speaker. In the context of your last remark and the question which prompted it, would you give further consideration to a practice which seems to have started today and which could frequently arise if other hon. Members resorted to it, namely, of asking supplementaries which are in no way connected with the main Question and your permitting them to stand in the way of other hon. Members who have tabled Questions? If I am right in this context, would you say, further, whether there is a special exemption for the Leader of the Opposition?

Mr. Speaker: Nothing happened today which was out of order.

Mr. William Hamilton: May I make further representations to you, Mr. Speaker, on the same point? The original Question which gave rise to these points of order was connected with a speech by the Prime Minister about very wide-ranging matters concerned with economic policy. Would not it be in accordance with the spirit of the recommendation of


the Select Committee if you ensured that hon. Members who had tabled Questions —even identical Questions—took preference over every other hon. Member, including the Leader of the Opposition? Is not it the case that the Leader of the Opposition can come in at the end of the chances given to every other hon. Member who has taken the trouble to table a Question? It is extremely unfair to at least half-a-dozen hon. Members on the Opposition side of the House.

Mr. Speaker: That is an interesting point of view which probably should be sorted out elsewhere.

Mr. Bidwell: Further to that point of order, Mr. Speaker. You will know that it is rare for me to raise a point of order when you are in the Chair. However, you named the Questions which were to be linked with Question No. Q2—[Interruption.] You indicated the other Questions which you proposed to call—at least that was what I understood—

Mr. Speaker: Order. It is the Prime Minister who announces which Questions he will link together, not the Chair.

Mr. Faulds: Further to that point of order, Mr. Speaker. You will know that it is not so rare for me to raise points of order. Would it not expedite Question Time if right hon. and hon. Members on the Government benches listened with the same quietness and courtesy to important questions asked by my right hon. Friend the Leader of the Opposition as we on the Opposition benches do to the non-answers of the Prime Minister?

Mr. Speaker: This is an occasion when it is not difficult for me to be impartial. I think that it is six of one and half a dozen of the other.

INDIAN HIGH COMMISSION (SHOOTING INCIDENT)

The Secretary of State for the Home Department (Mr. Robert Carr): With permission, I should like to make a statement about an incident this morning at the Indian High Commission.
The reports as yet available to me are inevitably incomplete, and exactly what happened is still far from clear.
A few minutes after 9.30 a.m. several members of the High Commission staff telephoned the police to say that an attack had been made on the building by masked men carrying firearms. Police detachments arrived almost at once, including four police officers assigned to the duty of protecting embassies and high commissions and, therefore, carrying firearms.
On arrival at the building, the officers were informed by one of the hostages, who had escaped by jumping through a plate glass window into the street, that the intruders had guns. On entering the building through a side entrance, two of the officers were threatened by one of the intruders with a gun. They took cover, drew their weapons and warned the intruder that they were armed police officers. This had no effect, and when the intruder moved across the room still aiming his gun at them one officer shot and killed him.
The two officers then went further into the room and were again threatened by a second man aiming a gun at them. He was also shot and subsequently died. A third intruder was arrested.
Three members of the High Commission's staff were injured by the assailants and received treatment in hospital, one of whom is still detained. Two police officers were taken to hospital, one of whom is still detained.
So far the police have taken possession of one sword, three daggers, an acid spray and two replica guns but have not found any actual firearms.
A number of witnesses of the disturbance are being interviewed by the police, and I expect shortly to receive further reports from the Commissioner of Police, including reports about the identity and nationality of those concerned and their possible motives.
My right hon. Friend the Minister of State for Foreign and Commonwealth Affairs meanwhile has visited the High Commissioner to express the deep regret of Her Majesty's Government at the injuries sustained by staff of the High Commission and the damage done to its property.

Mr. John Fraser: I thank the Secretary of State for making a statement. I express on behalf of the Opposition great regret


and concern that this conflict which has involved two deaths and several injuries should have broken out in the centre of London on the territory of a friendly Commonwealth country. I also hope that the injuries to police officers, innocent bystanders and members of the staff of the High Commission are not serious. I need hardly express my admiration for the courage and gallantry of those who faced people believed to be armed and obviously intent upon violence.
Has the right hon. Gentleman any knowledge about the motives of the intruders? Second, will there be a very thorough search for arms and ammunition, and, if they are found, will he do all that he can to establish the source? Third, is he satisfied that the situation was such that in the judgment of the police officers their action was the only way of controlling a very difficult situation? Fourth, will he confirm that the code of conduct of the Metropolitan Police for the issue of firearms to police officers was, as usual, strictly observed and that the Special Patrol Group unit which apparently also went to India House was not armed? I think that there will be concern if Special Patrol Group units are armed except in the most exceptional circumstances. Fifth, though I know it is difficult, can he say whether the High Commission and other diplomatic premises in London have devised adequate security arrangements so that action may be taken by the foreign countries themselves as well as relying on the Metropolitan Police? Finally, when the right hon. Gentleman has further information about this, will he make another statement to the House?

Mr. Carr: I will certainly give further information to the House when I have it. I thank the hon. Gentleman for what he has said about the courage and gallantry of the police. I will pass a message containing the appreciation of the House to the Metropolitan Commissioner. I believe that the speed with which this call was answered was outstanding. I am glad to say, as I am informed at the moment, none of the injured people is seriously injured. That is my present information, and I hope that it proves to be correct.
I have no knowledge at the moment about the motives of those involved. This is one of the matters into which we shall be inquiring most carefully. The police

will certainly make the most careful search for arms and ammunition, and, if they are found, every attempt will be made to trace their source. I should say in passing, and I expect hon. Members will know this, that the replica guns to which I referred have to be seen pretty closely before one realises that they are replicas and not the real thing.
I was asked whether I was as satisfied as I could be that this was the only course open to the police. I think I can assure the House of that on the information so far given to me. The whole thing is being looked into carefully. It is worth recalling that all the calls which came to the police from the Indian High Commission specifically mentioned that the intruders had guns. In addition, the one hostage who escaped by jumping through the window and met the policeman arriving specifically said that the intruders had guns. Therefore, when the police went into the building all the information available to them suggested that they were meeing intruders who had taken hostages and were carrying guns. This is exactly what they met.
I can assure the House that the code of conduct governing the carrying of guns by the Metropolitan Police is strictly observed. In this case, only four officers were armed. A much larger number of officers went to the scene. The four who were armed belonged to the small number of police specifically assigned to the duty of guarding embassies and high commissions. We know, alas, from our experience in London, as well as from experience in other countries, that people who attack embassies and high commissions are liable to be armed.
I am sure the House will think it right that our special detachment of police whom we expect to go to these places should themselves be armed. No other police officers were armed, and of the four who were, only two drew their guns.
The hon. Gentleman asked me one further question but I am afraid it has slipped my memory.

Mr. Fraser: Is the right hon. Gentleman consulting the high commissions to make sure that they make their own security arrangements?

Mr. Carr: Indeed. We are in constant touch with embassies and high commissions about this. We have a duty to


provide protection to foreign embassies and Commonwealth high commissions in this country. I can assure the hon. Gentleman that the embassies and high commissions are increasingly taking measures to protect themselves.

Mr. Tugendhat: I express my sympathy to the Indian High Commissioner and my admiration for the police.
I realise that this is a difficult subject for the Home Secretary to speak on, with the facts so recently at hand. Will he bear in mind that most of the embassies and diplomatic missions in London are in my constituency and that many are surrounded by houses and residential property? Is he aware that this incident, which is the second involving guards for embassies, is causing increasing and widespread concern among the people who live in Westminster? Is he aware that I hope that when he feels the moment is appropriate he will be able to take the public as well as the House as much into his confidence as possible to allay the doubts and worries which some of the people in London justifiably feel?

Mr. Carr: I understand the concern that is caused to the whole population by incidents of this kind. It is disturbing that such incidents, which we never expected to happen in London, have now taken place. I believe that prompt action by the police to demonstrate that anyone who attempts this sort of thing at an embassy or high commission in London will be caught and dealt with is perhaps the best deterrent and the best way of allaying people's fears.

Mr. David Steel: I am sure that my hon. and right hon. Friends would wish to be associated with the Home Secretary's message of concern to the Indian High Commissioner. Will the right hon. Gentleman consider making a further statement this week when more facts are available? This is obviously a matter of considerable concern. May I ask a question about the replica guns? Will the right hon. Gentleman undertake to see whether it can be established where these originated, because there is a growing concern in this country that these things are freely on sale in toy shops?

Mr. Carr: I will seek an opportunity to give further information to the House as soon as I have it. I am concerned about these replica guns. Recently I received a report from a Home Office working party dealing with the whole question of firearms. This is one of the matters which I shall be considering.

Mrs. Knight: Will my right hon. Friend bear in mind the possibility that this deplorable incident may well have sprung from the growing concern which Pakistanis in this country have for the 19,000 civilian prisoners who are still kept under duress by India? Will my right hon. Friend have conversations with the Foreign Secretary about this?

Mr. Carr: My hon. Friend should not prejudge the position. We will make these inquiries and my right hon. Friend will take a close interest in the outcome.

Mr. Edward Lyons: Is not the lesson of this deplorable incident that two men lie dead because of the use of replica guns? Is it correct that they are imported from Japan, yet their sale is banned there? Is it also correct that they are made so as to be the same as real guns in balance, colour and appearance, so that even experienced officers used to handling firearms are deceived? Must not something be done quickly to stop the importation and distribution of these guns?

Mr. Carr: I am concerned about this question of replica guns and will be looking into it. The House ought not to accept such a simplification of this, that two men lie dead because of replica guns. Two men lie dead because an armed assault was made on the Indian High Commission. Even if the guns were replicas and even if no real guns were found, the acid spray was real, the daggers were real, the sword was real, and they were used and injured people.

Mr. Fidler: Will my right hon. Friend accept that the feeling on this side of the House, and I believe throughout the country, is satisfaction and approval that these four armed police officers were so readily available and on the spot so quickly? Is he aware that my only regret is that more armed officers were not available on this occasion? Will he accept, in view of the increased use of


firearms by terrorists, and the fact that capital punishment has been sumarrily executed on the two alleged gunmen, that the time has come to consider whether this deterrent should not be replaced on the statute book?

Mr. Carr: I will not take this opportunity to enter into a debate with my hon. Friend on some of the matters he has raised. I cannot accept what he has said about the need for more armed police to be available. What is necessary in exceptional circumstances is that police should be available quickly, and, if necessary. one or two of them should be armed. We will see that that is achieved. It is the speed of the police reaction and the fact that of those who came it was only felt necessary for four to carry arms about which we should be pleased.

Mr. Bidwell: If it should turn out that this incident has anything to do with the recent war between Pakistan and India, will the right hon. Gentleman bear in mind that almost all people of Pakistani and Indian origin in this country will deeply deplore what has occurred? Will

he bear that very much in mind in seeking to obtain evidence, and round up the culprits and prevent a similar occurrence? Will he also remember that a recent Select Committee report pointed out that the overwhelming number of Pakistani and Indian people in this country were more law-abiding that the rest of us?

Mr. Carr: I am sure it is true that the overwhelming majority of citizens of Asian origin in this country will deplore what has happened this morning as much as anyone else. I can certainy confirm that our statistics show, as indeed the Select Committee brought out last summer, that, if anything, that community has a lower crime record than the rest of the community.

WELSH AFFAIRS

Ordered,
That the matter of Bilingual Traffic Signs in Wales and the matter of Unemployment in Wales, being matters relating exclusively to Wales and Monmouthshire, be referred to the Welsh Grand Committee for their consideration.—[Mr. Prior.]

CIGARETTES (PROHIBITION OF ADVERTISING) BILL

3.53 p.m.

Mr. John Parker: I beg to move
That leave be given to bring in a Bill to prohibit the advertising of cigarettes; and for the purposes connected therewith.
The many problems connected with cigarettes have been discussed by the Royal College of Physicians since 1962, ending with a much more radical report and recommendations in 1971, but so far no effective action has been taken by this House or the Government to deal with the problems arising from the smoking of cigarettes.
There was a considerable drop in the sale of cigarettes following each of the reports by the Royal College of Physicians, particularly in 1971, when there was a drop in sales of 4·3 per cent. compared with the previous year, but in the past year there was once more an increase in the consumption of cigarettes. Consumption increased in 1972 by 6·5 per cent. This reflects what has happened consistently. A report comes out, the public takes some notice of it and there is a drop in the consumption of cigarettes, but within a year the figure goes up once more, probably to higher than it was before.
Cigarettes represent a growing menace. In 1940, 25,000 people in this country died from TB and 5,000 people died from lung cancer. In 1970, hardly anyone died from TB but 50,000 people died from lung cancer. As many people died from lung cancer in 1970 as were killed in all our air bombing crews during the war; four times as many people died as were killed on the roads, and there were far more deaths from cigarette smoking than from drugs in that period.
Let us look at the question of other forms of disease which follow the smoking of cigarettes. Not only does the serious problem of lung cancer arise from cigarettes, but cancer of the stomach and the very unpleasant and painful cancer of the bladder. Coronary thrombosis is worsened and the incidence of bronchitis, in particular, has increased in recent years. In spite of action to promote clean air, there has been an increase in unclean air in cinemas and other public places;

which has led to an increase in the English disease, bronchitis.
I think most of us would agree that people have the right to kill themselves in a particular way if they want to. On both sides of the House there is support, I think, for the new liberalism—with a small "I"—which says that to a large extent the individual has the right to do what he likes. But I put the point today that the community also has rights, as well as the individual. When people are killing themselves in this way the result for the community has to be considered. First of all, if a young man kills himself in this way his family has to be supported by the community. The whole of our health service has been twisted by the need to deal with people who suffer as a result of the smoking of cigarettes. Then again, the question of bronchitis has to be considered. It is other people who suffer from what the individual does when he indulges in excessive smoking.
The Bill I am proposing would ban all advertising, whether in newspapers or magazines, on billboards, in cinemas or theatres, on radio, in pubs, at race courses, and so on. Such advertising is already banned on TV. It would also ban sponsorship of sports events by cigarette manufacturers. This is very important because I am quite sure that this policy of trying to win support for smoking from the young is one of the most evil developments of recent years, and is not peculiar to this country.
The latest figures show that the various cigarette companies last year spent £52 million on promoting the smoking of cigarettes. What have the Government done to counter this? They have announced that they are spending £48,000 on a poster campaign. They will also be spending £72,000 on a run-up campaign in connection with the tar and nicotine content of cigarettes and they will spend £37,000 following that up. In other words, they propose to spend £157,000—a drop in the bucket compared with the amount being spent to promote cigarette smoking.
Other countries are taking action. The United States followed ourselves in banning television advertising. There was an enormous hoo-ha in America against this proposal because at that time, two years ago, 15 per cent. of the advertising


receipts of American television companies came from cigarettes. None the less, the American Government abolished the advertising of cigarettes on television, and the television companies had to find other sources of income.
In 1971, Yugoslavia abolished all advertising of tobacco products. A law to that effect was passed by their Federal Parliament by 70 to 12.
With regard to the Scandinavian countries, the Nordic Council—that is, Denmark, Norway, Sweden and Finland—had discussions on the matter and decided by a majority of 35 to 27 that all the countries should go ahead with legislation in this field. The Norwegian Government, in spite of being in a minority position, is introducing a Bill in the Storting this week to ban all advertising of tobacco products. The other Scandinavian countries are preparing similar legislation.
It is interesting to consider Canadian experience. Canada decided to have legislation to ban cigarette advertisements. However, when the legislation had been prepared, the tobacco companies persuaded the Government to withdraw the legislation on condition that they voluntarily banned a large field of advertising for cigarette products. Having done that, they have now moved in a big way to the sponsorship of sport on which they are spending a great deal of money. As a result the whole matter of whether legislation should be introduced in Canada is again under discussion.
The Government have not acted very effectively. They have issued a health warning, which has had no effect at all. Now they are proposing that a list be drawn up of cigarettes with their tar and nicotine content. Cigarette packs will show what the content is, and the public will be advised to smoke those which have the lower content. I would like to ask why the Government are not proposing also to show the sugar content, because that is also one of the very important factors in producing the ills that follow from cigarette smoking. If they are going to draw up such a list of cigarettes, they should vary the taxation and make it high on those with a high nicotine, tar or sugar content. That would

be one way to make some good use of the content list.
I agree that the banning of cigarette advertising will not solve this problem, but it will make an important contribution. The tobacco firms are frightened about the propaganda which is being used against them. Last year when I proposed a similar Bill I was approached by three hon. Members who said that they proposed to oppose it on behalf of the tobacco interests. In the end none of them did. The hon. Member for Canterbury (Mr. Crouch), who did so, said that he represented the advertising interests.
It is unlikely that anyone will oppose the Bill today. Last year I went to speak upon the matter at the BBC. I was told that the BBC had approached seven representatives of tobacco firms to oppose me on the matter. Apparently they took the view that it would be unwise to discuss the matter and the tobacco companies would not touch it with a barge pole. They believed that the less said about it the better.
I challenge any opponents of the Bill to vote against it today. Last year they were surprised to find that 132 people voted for and 72 against. Therefore, I challenge them to press the matter to a vote today so that we may know where we stand.
In conclusion, I say that this is a moral question. We have to try to defend the young from becoming smokers. We cannot force people to give up the habit and we do not wish to force adults to do so, but we can do our best to ensure that there is no kudos in smoking.

Question put and agreed to.

Bill ordered to be brought in by Mr. John Parker, Dr. Tom Stuttaford, Mr. Laurie Pavitt, Mr. David Steel, Sir Brandon Rhys Williams and Sir Gerald Nabarro.

CIGARETTES (PROHIBITION OF ADVERTISING)

Bill to prohibit the advertising of cigarettes; and for purposes connected therewith, presented accordingly, and read the First time; to be read a Second time upon Friday next and to be printed. [Bill 72.]

STEEL

4.3 p.m.

The Secretary of State for Trade and Industry (Mr. Peter Walker): I beg to move,
That this House approves the White Paper, British Steel Corporation: Ten Year Development Strategy (Command Paper No. 5226).

Mr. Speaker: I should inform the House that I have selected the amendment standing in the name of the Leader of the Opposition and his right hon. and hon. Friends, to leave out from 'House' and add instead thereof:
Whilst welcoming the Government's conversion to the commitment of an expanded steel industry, regrets that the White Paper, Command Paper No. 5226, contains quite insufficient information about the Government's general strategy and responsibility for the industry; calls upon the Government to provide much fuller information, including publication of reports of the Task Forces; and strongly condemns the failure of the Government to take account at all in the White Paper of the individual representations of the steel communities threatened with closures.

Mr. Walker: We are concerned here with a major White Paper which outlines the biggest modernisation programme to take place in the history of the steel industry. First, I should like to say a few words about the background to the preparation of the strategy, because remarks were made in the earlier debate on the topic and have been made since which give a false impression as to how the strategy was developed. The strategy put forward in the White Paper is that put to me by the British Steel Corporation and which has the entire agreement of every member of the Corporation's board. There have been implications that the strategy was modified under Government pressure. But the Corporation, and certainly the chairman of the Corporation and his colleagues have stated publicly and know that this is not the basis of the strategy.

Mr. Arthur Bottomley: Is the Secretary of State saying that there has been no pressure at all or that there has been none in recent times? My impression was that there was great pressure upon the Corporation earlier.

Mr. Walker: There has been no pressure on the British Steel Corporation. The plan that it is putting forward is the

one which it believes is realistic and sensible and which I certainly discussed with it at great length after seeing delegations, including one of which the right hon. Gentleman was a member. I had discussions with the Corporation at which I put various points that had been put to me and my colleagues from delegations about the future of British steel.
I cross-examined the Corporation on a number of its assumptions and to the best of my ability, with my colleagues, I have examined the strategy it put to my Department. The Government have accepted the strategy in its entirety because from that cross-examination we believe that the arguments it put forward were the correct ones. First, therefore, I wish to make plain the basic fact that this is not a plan put forward by the British Steel Corporation under pressure from the Government. It is a plan which the board of the British Steel Corporation full-heartedly supports and considers to be correct.
Secondly, I should like to say a word about the amendment put down by the Opposition. I regret it because it somewhat detracts from the importance of the modernisation programme vis-à-vis the world at large, and it has all the disadvantages that the hon. Member for Sheffield, Brightside (Mr. Eddie Griffiths) pointed out in his speech on the previous debate. I hope he will forgive me for quoting him. He said:
I have great sympathy with the redundant steelworkers, but it comes ill from those politicians who say, because their constituencies are affected, If the huge investment proposed under this great plan, with all the coastal sites, does not happen to come to my midden, I condemn the whole scheme as shocking and I shall not play ball'. I wonder what the whole exercise is about. That is what steel debates in the House are deteriorating into. They are becoming debates not on a broad, logical policy for the industry which will safeguard it for the future, but on parish pump steelmaking.
He went on to say
Many of us on this side of the House have never realised that when we modernise and put in competitive steel plants there is a price to pay. What we have seen in the last few months—indeed, the last couple of years—is that we jib at the price we have to pay. I do not mean the price in terms of human suffering, which I shall come to later, but the price of closing obsolete plants, plants located in wrong places, plants based on wrong technology and so forth."—[OFFICIAL REPORT, 25th January 1973; Vol 849, c. 757–8.]


The hon. Member, who probably knows more about the practical problems of the steel industry than most hon. Members, was on to an important and very understandable point.
The other point about the Opposition amendment is that they at least deserve a certain admiration for their basic audacity. It is interesting to hear the hon. Member for Chesterfield (Mr. Varley) going up and down the country talking about a 43 million tonnes output and the need for a much bigger programme. The potential job losses in that policy will be dealt with later in my speech, but it is interesting to see the new mood of the Labour Party about how vital it is to expand steel even more ambitiously than is proposed in the White Paper in view of what the Labour Government did. In the four years before they came into office investment in the steel industry amounted to £1,116 million. In the six years they were in office—a 50 per cent. longer period—they spent £747 million in investment in the steel industry. They spent 50 per cent. less in six years than had been spent in the previous four years.
As to steel production—and we hear all these lovely figures of £43 million by 1980 tripping off the lips of the hon. Member for Chesterfield—here was a Government that in 1965 said the steel industry should increase its production from 23,180,000 tons to 27,250,000 tons by 1970. In reality by 1970 they had increased steel production from 23,180,000 tons to 23,980,000 tons. In six years of Labour Government there was an increase in steel production of 800,000 tons. That is the party which now condemns us for suggesting that we shall increase steel production by only 11 million tonnes in 10 years, the party that failed to increase it by even one million tonnes in six years.

Mr. Gerald Kaufman: Is the Secretary of State telling us categorically that production of 38 million tonnes will be reached by 1980?

Mr. Walker: if the hon. Member reads the White Paper he will see that what I am saying is that the strategy we are agreeing will ensure that provided demand is appropriate production will rise to 38 million tonnes by 1980, with a minimum of 35 million tonnes.

Mr. John Morris: Will the Secretary of State agree that we inherited a large number of companies with a low financial status, low technology and low productivity. Private industry had failed miserably in the years before in the sense that the state had to finance and carry the burden of major investment both at Llanwern and of £50 million which went into the begging bowl of Colville's at Ravenscraig.

Mr. Walker: I wish the right hon. Gentleman had listened. Had he done so he would have heard me say that over the four years prior to the last Government coming into office investment in the steel industry was running at £1,116 million, a very high rate of investment in that particular period, and it was stopped purely because the Labour Party decided that nationalisation was more important than modernisation. But the other remarkable thing about a party that is now the arch expansionists of the steel industry is that this was no part of its programme at the last General Election. One can search the election manifesto of the Labour Party at the last election, for example, and one will not find a paragraph or even a mention of the steel industry as a whole. No plans of any description were made public by the Labour Government before they went out of office for the modernisation of the steel industry.
I want, therefore, to bring to the attention of the House the importance of having, at long last, a very substantial and very important modernisation programme. This is a modernisation programme that would ensure that by the year 1980 we can have production of between 33 million and 35 million tonnes. [HON. MEMBERS: "But not 38 million."] No, but increasing by 11 million tonnes in eight years—to the 35 million tonnes, so that when we reach 38 million tonnes that will be an increase of 14 million tonnes on what we inherited when we took office from the Labour Government. This strategy embarks upon a programme which will go for 33 million to 35 million tonnes by 1980 and can be extended to between 36 million and 38 million tonnes by the early 1980s. Hon. Gentlemen opposite in the last debate which took place suggested that this was for 1990. In fact, the provision for going to 38 million tonnes is one that can be


reached in the first half of the 1980s. With the private sector, which is likely to produce upwards of 4 million tonnes at that stage, it represents a total capacity of the industry of 42 million tonnes by the early 1980s, certainly one of the biggest expansion programmes we have ever undertaken, one calling for massive resources, and one which I believe is very much needed if we are to continue a major presence in the steel industry.
France has embarked on an important modernisation programme. So has Italy, and, as we know, so has Japan. All these countries, in embarking on these major expansion programmes, have sensibly and wisely used the most up-to-date technologies and up-to-date methods to be competitive. If we are to secure the jobs of the great majority of the people employed in the steel industry it will only be by having the most up-to-date methods and technologies and using the best steelmaking methods that are available to us. It is vital to recognise that this gives a unique opportunity to the steel industry.
In fairness to the Labour Party, its amendment starts by welcoming the fact that modernisation will take place. But I wish to make another point perfectly clear to the House. There is quite a temptation on the part of the Labour Party to suggest that if a higher figure is used all the old plants, however old and wherever they are located, can continue in existence. It will be very interesting to hear this afternoon any reference by the Labour Party to plants which in their view ought to go out of operation. I wait to hear which plants are so badly out of date or so badly located that they are considered to have no future.
I wish to make it perfectly clear that if one decides to go more speedily to a higher figure and one's assessment of world demand and domestic demand proves to be wrong, the result will be that a number of plants now destined to be closed at the end of this decade will have to be closed far sooner and far more rapidly, because the only way substantially to extend still further this programme is to have some major new sites available—for example, competitive coastal sites at various places, which could be made available, with enormous investment, where it would be vital to use

this capacity. If one did so and the higher production failed to occur, of which there is great danger, we should be putting a substantial number of jobs in jeopardy sooner, quicker and in a more devastating way than under the provision made in this strategy.
I believe that both sides of the House are very concerned about the social consequences of any modernisation programme. From the best judgment that the Government and the British Steel Corporation can make, if we are concerned about the security of the jobs and the time to take action we should not go for a far speedier programme of expansion than that which is outlined in this White Paper.
I should like to say a word on the size of the problem in respect of job losses. This is set out very clearly in the White Paper in which we deal with it region by region, indicating the number of jobs affected. There was a suggestion in the last debate—I agree that it was before the White Paper was published—that in my original statement I had left out a number of unemployment potentials. The White Paper shows clearly that this was not so. Indeed, the estimate we have made of the drop in the number of jobs available in the steel industry—50,000—is, if anything, an outside estimate and not one which has been modestly based.
In estimating potential losses of jobs it is important to put a realistic figure, and if necessary an outside figure, and not to underestimate the position. For example, it was suggested last time that the potential closure of Brymbo and East Moors had not been included in my original figures. The White Paper made it clear that these were included. As far as East Moors is concerned, it is expected that there will be a mill which will provide probably 500 jobs in the private sector. As far as Brymbo is concerned, negotiations are going on with Guest, Keen Nettlefolds at the present time and if these are successful that mill, with some 2,000 jobs, will continue in being. This will accordingly reduce the net figures for unemployment in Wales arising from steel closures. Therefore, the figures have been estimated as objectively as possible and we have taken the outside figures that may occur during the period of the strategy, rather than modest figures.
I wish to put these in the context of what has previously happened in providing new jobs and in terms of past redundancies. The total figure for the steel industry of 50,000 in 10 years, for example, compares with redundancies in the nationalised industries of 404,000 in the six years of the Labour Government. In that period 232,000 redundancies were made in coal, 134,000 on the railways and 20,000 in steel. That was in six years of a Labour Government. If in 1964 a Conservative Government had come to the House with a White Paper outlining 232,000 redundancies in coal I wonder what would have been the reaction of the Labour Party and how impossible they would have said it was to meet that problem.

Mr. Ted Leadbitter: Would the right hon. Gentleman bear in mind that it is not quite sufficient to give the House figures over an extended period about redundancies in the whole of the nationalised industries, when we are talking in terms of the figures of the steel industry by itself, without quoting them. I do so now. The figures of the redundancies of all the nationalised industries in the country since June 1972, in the northern region in particular, have consistently been at the rate of 2,000 a month.

Mr. Walker: The White Paper clearly shows that substantial steel redundancies occurred in the North East in that period. On the railways, redundancies have occurred much more slowly than previously. As a result of the measures I announced in the Coal Industry Bill, redundancies will be much slower in the coal industry than they were during the six years of Labour Government.
During the six years of Labour Government there were substantial redundancies due to changes caused by pits not being economic and various other matters, and in the nationalised industries there were 404,000 redundancies. I give that figure to get into context the present 50,000 redundancies in 10 years. Also important in getting the 50,000 redundancies in the right context are the number of jobs provided and the number of jobs that have come into the regions during the same period.
The White Paper envisages a total net loss of jobs in Scotland of 6,500 over the

period of the strategy. Yet between 1960 and 1969, 184,000 new jobs were provided in Scotland. We are talking about tackling a problem—I agree an additional problem—of 6,500 jobs in steel over the next decade.
In the northern area we are talking about 6,000 additional jobs lost in steel. Between 1960 and 1969, 167,000 new jobs were provided. Unemployment in the North-East has dropped during the last four months by 6,000. In the North East, more advance factories were taken up last year than were taken up during the whole of 1969 and 1970 together. Expansion is taking place in those areas.
Likewise, in Wales, which is by far the worst hit of the regions—

Mr. John Robertson: Will the Secretary of State tell us, along with the jobs that were brought to Scotland, how many jobs were lost in the same period? What is the comparison between the number of male jobs in June 1970 and the number today?

Mr. Walker: Certainly during the six years of Labour Government a large number of jobs were lost in the nationalised industries in Scotland. I am saying that a large number of new jobs came in during that period. I am not arguing that jobs were not lost. I am trying to put the 50,000 jobs lost over a decade in the context of the 404,000 lost jobs in the nationalised industries in the six years of Labour Government. Members of the Labour Party would be much more impressive if they had made as much noise about the 404,000 redundancies as they are now making over the 50,000 redundancies.
Wales is the worst hit area, primarily because that is where the largest number of steelworks are operating. In Wales, the White Paper estimates a total reduction in the number of jobs of 17,500. On the basis of a new mill at East Moors and the continuation of Brymbo, that figure will be somewhat lower. Between 1960 and 1969, 120,000 new jobs came into Wales. That shows that there is an ability to meet this problem.
I want to say a few words about Ebbw Vale, partly because the hon. Member for Ebbw Vale (Mr. Michael Foot) is to wind up the debate and in our last steel debate he mentioned some of the problems there.


First, I wish to make it clear that the future of steelmaking in Ebbw Vale was raised before the last General Election, and the hon. Member for Ebbw Vale knows that to be so. So that there is no doubt about this, I will quote from the British Steel Corporation Press handout of 24th March 1970, which said:
There will be no long-term future for iron and steelmaking in its present form at Ebbw Vale, the coastal works being in a much better position to produce large tonnages of steel at economical costs.
That statement was made in Ebbw Vale in March 1970.

Mr. Michael Foot: I hope that the right hon. Gentleman will not again perpetrate the mistake that he and other Ministers have made on other occasions of reading out just that sentence. I hope he will go on to read out the further sentence, which must have the same standing as the reference to reductions, and which is to the effect that 8,000 jobs would be provided and retained at Ebbw Vale and that money would be spent on the hot mill which was to be retained. Those are the items which gave us the readiness to support the general proposal.

Mr. Walker: As the hon. Gentleman knows, I have been down to his constituency and discussed this matter with the people concerned, and I have no intention of misleading either the House or the people of Ebbw Vale—[HoN. MEMBERS: "Read on."] Certainly I will read on. I wish to make it clear that at that time it was stated that steelmaking would cease at Ebbw Vale. That was before the General Election. It was said that £45 million was to be invested in the additional mill. That was the main theme of the hon. Gentleman's election address which was entitled, "How to keep that £45 million feeling". Surprisingly, that address did not deal with the sentence I have just read. It dealt with the future and the new investment of £45 million which, as the hon. Gentleman himself said, would substantially reduce the number of jobs at Ebbw Vale but would still leave 8,000.
Since that time the BSC has decided to close the mill and has given five years' notice of that decision. One new factor is another major investment in tin plate

of £50 million which the BSC has decided to make in Ebbw Vale. The closures that were spoken of in 1970—before the General Election, before the strategy was thought of—BSC now intends to fulfil five years later, in 1975. BSC has given notice that the closure of the hot mill is expected to be just over five years after notice has been served.
The hon. Member for Ebbw Vale has made a significant statement of policy on behalf of the Labour Party on this topic. He has said that closures of nationalised plants should be a matter for the Government and not for the nationalised industry. That is a significant change of policy. I hope that the speeches made in this debate will make perfectly clear how the Labour Party intends in future to operate closures in nationalised industries.
The hon. Member for Ebbw Vale in a speech made locally in the West Country and reported in the Western Mail—I agree not nationally, but presumably the Western Mail was accurate on this—said:
The Labour Party last night pledged to take immediate action to withdraw the dates for the proposed steel closures in Wales if they are returned to power.
He went on to say:
I…make this statement officially on behalf of the Labour Party after consultation with its leader, Mr. Harold Wilson, following publication of the Government's White Paper on steel.…The next Labour Government would make a fresh examination of the position of the steel industry, and of what alternative employment had been provided for the threatened areas.
I ask the House to realise the significance of this commitment by the Labour Party. The Government obviously cannot say to the steel industry, if it has a plant which is to be closed in Ebbw Vale, that they will fix the date of that closure. The Government cannot say to the colliery industry, if a colliery is closing, that they will fix the date of the closure. I presume that in coal as well as in steel the hon. Member for Ebbw Vale has committed the Labour Party to saying that in future, instead of the nationalised industries deciding the timing of closures it will be done by Ministers and Government Departments.

Mr. Kaufman: Surely the right hon. Gentleman is aware that in the autumn of 1967 the then Prime Minister was


playing an active part with other Cabinet Ministers, with the chairman of the NCB and with the NUM, and that the Labour Government intervened and for social reasons prevented many coal mines being closed down?

Mr. Walker: One may organise the application of a general policy, as I did in my Coal Bill more than anyone else had done in this context. That is very different from saying that in future Governments will make decisions on the time of closures. I ask hon. Members from the North-East to realise the implications of that sort of decision for Teesside. One cannot have a decision taken by Ministers against the strategy of the British Steel Corporation to close a works in Ebbw Vale and to keep a plant on Teesside working. That would put in jeopardy the whole potentiality of the new plants because one by one Ministers would say to management of nationalised industries that any decision on timing of closures would no longer be taken on the basis of what management considered best for an industry but on the basis of what the Minister concerned considered best.

Mr. Foot: I confirm that the quotation made by the right hon. Gentleman from the Western Mail was absolutely accurate. We fully stand by that statement. What we are saying is that proposed dates for closures will be suspended, first so that the position of the industry can be surveyed afresh, because we are not satisfied with this Government's survey and, secondly, in the light of what alternative employment is actually available in the area. Unless the Government take steps to suspend the closure dates to ensure that that happens, all their pledges about alternative employment may prove to be hot air.

Mr. Walker: The hon. Member said much more than that in the statement he made. He was not saying that he would review the position because he considers the Government's assessment is wrong, but that the British Steel Corporation and the Government in their assessment are wrong. He is saying that a Labour Government will know, in terms of the date on which to close particular mills and plants, better than the people managing the industry. That is some-

thing which for six years the previous Government avoided doing. They were pressed time after time by their hon. Friends to do that, but for very valid reasons of enormous financial consequences, and the consequences in respect of trying to attract good management to nationalised industries, they did not do so. How can a Government attract good management to the nationalised industries on the basis that the decision should be made by a Minister with relative lack of knowledge? If that commitment continues and goes forward by a Labour Government it will be very bad for the future of the country.

Mr. Foot: We shall have further time to debate this and it will be fully debated in the steel areas. What we are debating today is the White Paper presented by the Government. We are dissatisfied with the Government's survey of the industry, which does not cover these matters satisfactorily. Why does the right hon. Gentleman not try to defend his Government's record rather than shelter behind the British Steel Corporation?

Mr. Walker: It so happens that my Government's view is completely identical with the view of the British Steel Corporation. It is a corporation of which the chairman was appointed by the previous Government. The hon. Member is saying of this strategy, prepared by the British Steel Corporation and recommended by the Government, that he does not agree with it and that future Labour Governments will operate the power to decide dates of plant closures. This is a very important and significant change. If future Labour Governments tried to operate that policy they would regret it because never again would they attract managerial ability to operate such a process.

Mr. John Mendelson: Why is the right hon. Gentleman trying to isolate my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot) and to fasten this attitude on him? It is a waste of time to do so. Why does the Minister not quote the decision of the steelworkers' union—a very important decision—that because of the difficult employment situation in many steel areas the union will oppose any closure of a steelworks before new jobs have been assured for the steelworkers in the area? This is not an


individual point of view of my hon. Friend.

Mr. Walker: Mr. Walker rose—

Mr. Mendelson: Will the right hon. Gentleman allow me to finish while I am still on my feet? He has no right, having given way, to rise while I am speaking. He has to wait while an hon. Member completes his intervention. Why does he not admit that the policy originally accepted by people in the steel industry had two prongs—modernisation and therefore a certain reduction in the number of jobs, and creation of new jobs in steel and other industries before closures take place? That is the policy of the Labour Party today.

Mr. Walker: I repeat that in the six years when the Labour Party was in power there were 404,000 redundancies in the nationalised industries. That took place without ministerial interference and without providing new jobs for many of those concerned. That was their record.
The British Steel Corporation has informed me that today it is sending a memorandum to the works committee of Ebbw Vale giving the factual background for the basis of its decision concerning both financial strategy generally and Ebbw Vale in particular. That will be in the hands of the works committee tomorrow. The Corporation has stated that it is its intention to discuss with works committees the financial implications on which it takes such decisions.
Very seldom do hon. Members opposite mention the very considerable extra job opportunities which this strategy pursues. This is totally ignored by the Labour Party. They had incredibly low investment in steel, indeed a reduction in investment, and doubtless many jobs were lost in the industries involved in creating new plants. The White Paper states that 75,000 jobs will be supported during the work of modernisation. No fewer than 13,000 jobs will be sustained in civil engineering, 12,000 in structural engineering, 6,000 in general fabrication, 24,000 in the provision of mechanical equipment, 15,000 in the provision of electrical equipment and 5,000 in engineering services. That is a total of 75,000 jobs sustained throughout this strategy and a great

number of those jobs will be in the development areas.

Mr. Eric G. Varley: The right hon. Gentleman will remember that in his statement on 21st December he not only said that 75,000 jobs would be sustained but actually said that they would be created. When he was questioned by me he was even firmer and Perhaps it was a slip of the tongue. Can he break down these totals further and say how many new jobs will be involved?

Mr. Walker: It is impossible to do that. [HON. MEMBERS: "Oh!"] I would be deceiving the House if I tried to do so. I can say that this is increasing investment by 50 per cent. and will create many more jobs than reducing investment by 50 per cent., which is what the last Labour Government did. There will certainly be new jobs. During the six years of Labour Government, with a considerable reduction in the programme, many jobs were lost. There are the additional potentialities of considerable export orders due to the high level of domestic demand. We have had talks with the steel manufacturers of this country to see whether we can conduct a worldwide market survey of the potentialities for building steel plants abroad so that a firmly based domestic industry can take full advantage of international potentialities.
Also in relation to job opportunities, we have announced the creation of task forces in five areas, potentially the worst affected. We have asked for an interim report from the task forces within a period of two months.
Added to this, I very much welcome the initiative taken by the General Secretary of the TUC, Mr. Feather, when he approached the Government and suggested that a consultative committee or group should be set up consisting of Mr. Feather, the Minister for Industry, and the Chairman of the BSC. This is a suggestion which we discussed with the corporation and it was gladly accepted. The consultative group will come into operation to consider arrangements for meeting the problems caused by steel redundancies.

Mr. Roy Hughes: The right hon. Gentleman has now been speaking


for three-quarters of an hour and he will be aware that the White Paper envisages of expenditure of £3,000 million in the next decade, of which £900 million is to be allocated to Wales. Will he give an assurance before he concludes that he will illustrate at what plants the £900 million is to be spent and on what projects.

Mr. Walker: No, I will not. If the hon. Gentleman is saying that I should go around the country analysing investment at each plant, it is an absurd suggestion and is not worthy of him. I am sorry the hon. Gentleman took so little interest in this initiative of the TUC on this topic. The first meeting of the group will take place next week and thereafter the group will meet regularly to see that progress is made. The combination of the Industry Act, the advance factory programme and retraining facilities will help the corporation and it is willing to give substantial economic growth and will do a great deal to assist in meeting the problems in these areas.

Mr. A. E. P. Duffy: Mr. A. E. P. Duffy (Sheffield, Attercliffe) rose—

Mr. Walker: I am sorry, I have given way many times, and I have already been told by the hon. Member for Newport (Mr. Roy Hughes) that I have been speaking for 45 minutes.
I should like to put the whole programme in the context of broad industrial strategy. We have for a long period, partly due to the effects of at one time seeking to nationalise and then to denationalise the industry, had a steel industry that has fallen behind the rest of the world. The corporation, with the ability at its command, has made its best estimate of what can now be done to catch up with the other countries and to provide the industry wtih a strong, successful and secure future. This is only part of the broad economic strategy. At the moment economic growth is taking place at a fast rate. It is interesting to note that the figures published only this week show that the consumption of British steel in the United Kingdom is up by nearly 14 per cent., compared with a year ago.
The exciting thing that is happening is that in a number of our major and

basic industries real progress is being made. Orders for commercial vehicles at home, in the last quarter for which figures are available, are the best in our history. The last quarter's figures for the machine tool industry were the best in our history. Over the last two months the shipbuilding industry has obtained massive and substantial orders. Indeed, in the last quarter of last year the shipbuilding industry obtained more orders than in the previous nine months. Today, the orders in our shipyards are virtually at an all-time record high in the history of shipbuilding. The construction industry in its use of steel also has had a period of expansion of considerable importance to the steel industry.
If we can modernise the steel industry, if we can use this opportunity of large orders to modernise the shipyards, if we can lay down considerable expansion programmes in terms of motor vehicles, the basic industries will at last expand and have an increasing share of world markets, instead of the declining share which they have suffered for so long. That is why I ask the House fully to support the policy laid down in the White Paper.

4.45 p.m.

Mr. Eric G. Varley: I beg to move to leave out from "House" to the end of the Question and to add instead thereof:
'whilst welcoming the Government's conversion to the commitments of an expanded steel industry, regrets that the White Paper, Command Paper No. 5226, contains quite insufficient information about the Government's general strategy and responsibility for the industry; calls upon the Government to provide much fuller information, including publication of reports of the Task Forces; and strongly condemns the failure of the Government to take account at all in the White Paper of the individual representations of the steel communities threatened with closures.'
If I congratulate the Secretary of State for Trade and Industry on nothing else, I must congratulate him on his sheer effrontery. In his statement last December, on television three weeks ago, in his Press conference two weeks ago and again this afternoon, his performance deserves a medal for salesmanship of a kind which would be envied by any foot-in-the-door salesman trying to hawk encyclopaedias.
The right hon. Gentleman said that the 43 million tonnes for 1980 tripped off my tongue. It also tripped off the tongue


of the right hon. Gentleman's predecessor. He said it on 18th March 1971 and presumably he got it from Lord Melchett. Therefore, it is not my figure. It is Lord Melchett's figure. When we look at the original plan put forward by the British Steel Corporation, we see that it was a programme for steel. When we compare it with the White Paper, we see that the White Paper chops off 10 million tonnes something like £1,000 million and 20,000 jobs from that original strategy. It is proclaimed by the right hon. Gentleman in bold and exciting terms.
If the Secretary of State had held his present position in ancient Egypt, no doubt he would have advertised the 10 plagues as a tourist attraction. Certainly with his long-standing enthusiasm for the Common Market he would no doubt have incorporated this text in a "Fanfare for Pharoah". At any rate, he would have been able to give the Israelis one or two tips on how to make bricks without straw. That is what he does in this pathetic and flimsy White Paper—a White Paper boosted so heavily in advance and found to be so utterly inadequate when published.
It is instructive to compare the first flush of the Secretary of State's statement two months ago with the sober, second thoughts of the White Paper. The right hon. Gentleman said flatly on 21st December that the steel strategy "will require"—I emphasise that he said "will"—
a programme of investment of £3,000 million….".—[OFFICIAL REPORT, 21st December 1973; Vol. 848, c. 1576.]
But the White Paper is a great deal more cautious. In paragraph 16 it tells us:
Over the next 10 years, BSC investment is expected"—
not "will" this time—
to average £300 million a year".
And the White Paper is even less definite than that, because paragraph 12 cautiously and hesitatingly states
…there is bound to be uncertainty about prospects so far ahead and they will be reassessed each year, and the timing of developments reviewed, when the corporate plan is rolled forward and discussed with the Government.
This is not a confident strategy looking 10 years ahead. It is a tentative blueprint whose validity will be reviewed annually.
On one page the impression is given that expenditure will be guaranteed for at any rate four years ahead. Paragraph 37 says,
Annual expenditure will rise until around 1976–77…".
But on another page we can see that the guaranteed time scale is even shorter than that. For example, in paragraph 13 it timidly informs us that
…the Government can review the progress of strategy before giving firm approval to capital expenditure for the second year of the programme and provisional approval for the third year.
Let us consider the situation in Wales, which has been mentioned by my hon. Friend the Member for Newport (Mr. Roy Hughes). The Secretary of State said on 21st December,
Wales will"—
and again we see the word "will"—
have…an investment approaching £900 million."—[OFFICIAL REPORT, 21st December 1973; Vol. 848, c. 1576–7.]
But the White Paper in Paragraph 47 turns that down and tells us that
Investment in Wales could"—
not "will" this time—
be as much as £900 million.
The first thing we want to know is just how much of that £3,000 million investment—and I remind the House that that is reduced from £4,000 million if we look at the original proposals of the British Steel Corporation—is certain and guaranteed. Is the £900 million envisaged for Wales assured or is it speculative?
I must tell the Secretary of State that there is deep suspicion in Wales of the Government's intention on the subject of the £900 million. This suspicion exists not only on this side of the House but even in the Western Mail which the right hon. Gentleman has just quoted. The Western Mail is not, I think, a publication noted for its revolutionary Socialist fervour, but it talked yesterday about grave doubts over the exact size of the steel investment plans for Wales.
These doubts will have been heightened by the remarkable letter sent by the Under-Secretary of State to my hon. Friend the Member for Newport, a letter which confessed that that £900 million was arrived at on the basis of "a very tenative estimate of how the £3,000 million might be divided between the main unions".
These doubts have been heightened by the extraordinary reply given only yesterday by the Minister for Industry to my right hon. Friend the Member for Aberavon (Mr. John Morris). The Minister said:
The estimate of as much as £900 million that may be spent in Wales"—
again it is "may"—
under the BSC's development strategy covers: (a) projects already in progress or announced; (b) those mentioned in the White Paper (Cmnd. 5226); (c) a high level of continuing investment for modernisation and replacement. It is impossible to give detailed estimates for each plant."—[OFFICIAL REPORT, 19th February 1973; Vol. 851, c. 5.]
No Welshman worried about steel jobs can begin to be satisfied about that kind of waffling and woolly reply.
It is, I think, paralleled only by the plaintive bleatings of the Secretary of State for Scotland when asked to specify details of the £400 million alleged to be earmarked for Scotland. The Secretary of State for Scotland was unable to give these details last month when the Scottish TUC asked for them. He declined to give them to the House when asked to do so by my hon. Friend the Member for Bothwell (Mr. James Hamilton), and the Department of Trade and Industry yesterday flatly refused to give my hon. Friend the Member for Rutherglen (Mr. Gregor Mackenzie) any reliable information whatever about the expected redundancies in Scotland. The House and the steel workers in England, Scotland and Wales have the right to know and have the right to be given precise and detailed facts.
Second, there is the question of the mini-mills. In the debate last month I referred to them as the mobile mini-mills. Now it seems they could be described as the vanishing mini-mills. On 21st December the Secretary of State certainly gave the impression that he was about to scatter mini-mills all over the country like confetti. Every time anybody rose on this side of the House to ask what would happen to his area, the Secretary of State said: "Your area is a candidate for a mini-mill".

Mr. Peter Walker: The British Steel Corporation suggested to me three possible sites in England. When questioned by hon. Members representing constituencies involving those three possible

sites, I duly commented in each case that the site was one of those that would be considered by BSC.
I gave hon. Members the facts as they were given me by the British Steel Corporation as to the sites it was considering.

Mr. Varley: Let us explore this further. The impression was certainly given on 21st December that the right hon. Gentleman was prepared to give mini-mills. In last month's debate the Minister for Industry brought us a little closer to reality, saying that there would be one mini-mill in Scotland and another elsewhere. That still added up to the definite prospect of two British Steel Corporation mini-mills.
But again the White Paper tones that down very much further. Paragraph 19 talks about "perhaps two new smaller electric arc steelworks". Paragraph 57 is even more hesitant, referring to Irlam, Bilston and Shelton:
These three works are among the possible sites for any further electric arc steelmaking plant that might be needed.
Now we see the mini-mill; now we see it taken away from us.
Only last week we heard a new and even more discouraging version from the Secretary of State. He was asked by my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding):
Will the right hon. Gentleman say whether it is certain that a steel-producing mini-plant will be provided at Irlam, Bilston or Shelton?
The right hon. Gentleman replied in confident ringing tones:
That is a separate question. I do not know the details of the answer."—[OFFICIAL REPORT, 12th February 1973; Vol. 850, c. 963.]
As I have said, on 21st December the Secretary of State was giving the impression that there would be quite a number of mini-mills. We accept what he has said today, but we are not at the end of this saga. We need to know much more about this matter. Perhaps the Minister for Industry will tell us precisely what will happen, especially in the Cardiff East Moors situation. The ignorance of the Secretary of State on that question, and on other matters, is one he is willing to share with us, for throughout this long-drawn-out debate and controversy on the steel industry, the Government have been consistent in one thing


and one thing only—their absolute determination to withhold information from the House and from the country.
There is not a word in the White Paper about the deliberations of the constitutional monstrosity, the Joint Steering Group. There is not a word in the White Paper about the McKinsey external consultants. The only document they have deigned to publish is this skimpy White Paper about which The Economist had this to say only a few days ago:
It failed to answer any but the most basic questions about the future shape of the industry or to provide much guidance about Government policy.
Now we have yet another refusal, a refusal to reveal the reports of the task forces. The Minister mentioned the matter this afternoon, but he did not say that the reports would be revealed. The Secretary of State for Wales only a few weeks ago flatly rejected this request by the hon. Member for Ebbw Vale (Mr. Michael Foot). He said, "No, you're not going to have the report. It will not be made public."
Why all this secrecy? Why can we not know what was in the Joint Steering Group? Why can we not know what was in the McKinsey report? Why can we not have the reports of the task forces? What have the Government to hide on this subject? What have they to hide, for example, about Brymbo? Brymbo was passed over with scarcely a mention when the right hon. Gentleman made his statement on 21st December. It was fobbed off in the White Paper with 17 dismissive words.
We know a great many things about Brymbo, of course. We know it is a highly successful plant. We know it is a profitable plant. We know it comes top of the league in the list of all British Steel Corporation establishments in terms of return on capital. We know that Raymond Brookes of GKN has his eyes on it. Is Brymbo to be the last victim of the discredited hiving-off policy? Is Lord Melchett being told that he must get rid of Brymbo? Is there to be a forced sale? If that were the case, it would be a scandalous situation. Why can we not be told about Brymbo?
We want to have these facts in the debate. I hope that the Minister for Industry will tell us exactly what is

happening in this situation. Will there be a forced sale? Is the British Steel Corporation being forced to dispose of it? What is more, the Government must be more forthcoming about the reports of the task forces.

The Secretary of State for Wales (Mr. Peter Thomas): I am particularly interested in the task forces because in the case of Wales they will be reporting to me.
The task force is composed of officials from various departments. The officials will be using their expert knowledge and the resources at their command in order to analyse a situation and to report back as quickly as possible. These are the reports of officials to Ministers. Does the hon. Gentleman seriously think these reports should be made public? [HON. MEMBERS: "Yes."] Officials would be put in an invidious position if their advice to Ministers were ever to be made public.

Mr. Varley: If right hon. Gentlemen are to have any success in convincing people in the communities concerned that they will do something about jobs in those areas, they must give them the facts. What was all that about open government we heard in June 1970, the ringing declarations of Downing Street that we would have open and honest government? I cannot understand this at all.

Mr. Thomas: The task forces will be consulting widely with all interested bodies. There is no reason why those bodies should not make public their submissions and suggestions to the task forces. But the task forces, as officials, will be reporting to Ministers, and it will be the decisions taken by the Government which will be made public.

Mr. Varley: I can only say to the right hon. and learned Gentleman that in the last debate we mentioned that The Times was saying—as it was—that it was window-dressing. We said that the Government were not window-dressing and that we were not as cynical as that. We wanted to know what the report was and we wanted some power behind the task forces. But the cynicism will return if we cannot have the information.
The Secretary of State for Trade and Industry made a great play about the


tri-partite consultative committee being set up by the Department, Lord Melchett and Mr. Victor Feather, on Mr. Feather's initiative. Will Mr. Feather be given the reports of the task forces?

Mr. Peter Walker: If Mr. Feather were dissatisfied with the information given by the Government, obviously he would walk out of such a meeting. The hon. Gentleman knows that the previous Government did not publish the advice by their officials. No Government ever has done that, for very good reasons. For example, if a task force official gave advice on a particular company which could be taken as detrimental to that company, is the hon. Gentleman suggesting that all that should be published?

Mr. Varley: That is a most extraordinary answer. We have a position where Select Committees call for papers, persons and records, and officials and lion. Members go before them and are, properly, questioned and reports made. I see no great difference. There would be no great departure in allowing the task forces to be reported. So far this has been a most discouraging interchange, because more and more people in the steel communities will come to the conclusion of The Times, that this is window-dressing and nothing but that.

Sir Anthony Meyer: Perhaps I can give the hon. Gentleman an example from my constituency. In the case of the imminent rundown at Shotton, numbers of people have come forward with proposals for supplying additional employment there. A firm in my constituency has put forward a scheme for providing 600 jobs in the Shotton area. The firm has encountered certain difficulties in the past. It seems perfectly obvious that the task force, in assessing the validity of the offer made by this firm, must be in a position to give totally confidential advice on such matters, for example, as the desirability of a change in the management of that firm, before the offer is taken up.

Mr. Varley: In certain circumstances there may well be information of a confidential and commercial nature. But I still think that the Government could find a way round this problem if they were serious about providing information.

Mr. Peter Walker: I very much agree with that. Certainly it will be my inten-

tion to see that, in respect of recommendations that the Government can pursue the task forces and the progress of them, there should be regular reports and announcements. But what one cannot do is publish all the advice given by one's officials.

Mr. Varley: All right. There is another example I should like to give of where we think it absolutely essential to have information and where we should know what the task force is advising. Let us take the particular position of Cardiff. We know that GKN want to go ahead with a mini-mill there if the area is not going to be up-graded as a development area. The Secretary of State said that at his Press Conference, reported in The Times on 12th February:
The task forces would also be looking at the necessity or otherwise of giving development area status to their respective areas and would also be able to make recommendations on this.
This is absolutely crucial. Why cannot we know what the task force recommends in places such as Cardiff? Certainly the right hon. Gentleman knows that designation or redesignation of assisted areas is crucial to the provisions for hard-hit areas. Not only Cardiff is involved, but Shotton, too, which is making claims that it should be upgraded from an intermediate area to a development area. Mr. Tom Jones, the Welsh Secretary of the Transport and General Workers Union, has painted a grim picture of Flintshire:
a depressed area sandwiched between two development areas.
It is that kind of information which we need, and we want to be told much more about these matters.
We should have much more detailed information about the help that can be expected from the European Commission under Article 56 of the European Coal and Steel Community. We understand that the negotiations have begun. What are the Government seeking, and who and how many will qualify for tide-over payments. We need that kind of information. Perhaps the Minister for Industry will say exactly what is involved in the negotiations with the ECSC. Unless we have that information people may say that it is another public relations gimmick.
We should also like to hear much more about the tripartite consultative group.


The Secretary of State mentioned it. Do the Government envisage, for example, that the high level group—it is certainly a high level group—will have a real and continuing rôle to play? Certainly Mr. Victor Feather envisaged that when he proposed it, as did Lord Melchett, obviously, when he so rapidly and readily agreed to support the proposals. But it would be useful if the Government could spell out at some stage exactly how they see the consultative group operating. We need to be told much more on these vital questions of the provisions for jobs.
The Secretary of State had something to say today about 75,000 jobs in heavy electrical, mechanical and civil engineering to be sustained and created by the steel modernisation programme. On 21st December the right hon. Gentleman was unequivocal about this matter. He said:
The investment required by the programme will sustain and create a large number of jobs, possibly as many as 75,000."—[OFFICIAL REPORT, 21st December, 1972; Vol. 848, c. 1578.]
When I had the temerity to ask him about 75,000 jobs, the Prime Minister on that day was so upset and offended that I should ask that question that his head nearly came off because he was shaking it so hard. But on that day the Secretary of State said that the 75,000 jobs would be created.
What we want to know about this is where they will be created. The Secretary of State said that they were likely to be created in the centres concerned. Nothing could have been clearer. But the White Paper, when it eventually appeared, was much more hestitant. It stated that:
The Corporation…believes it will provide or maintain employment opportunities for about 75,000 people.
Instead of the Secretary of State asserting that 75,000 jobs will be sustained or created, now the responsibility for the figure has neatly been passed to the corporation, which "believes" that 75,000 employment opportunities will be provided.
I went to the corporation the other day and asked for solid statistics about the 75,000 jobs. The corporation very honestly told me that the figure of 75,000 was only a tentative estimate and, what is more, the corporation could not guarantee how many, if any, new jobs would be

created. If the corporation told that to me, it must have told the same thing to the Secretary of State. So his brash assertion that jobs would be created is to some extent a deception of the House and, worse than that, a deception of men living in fear of losing their jobs and anxious to hear about the new job opportunities. It is indecent to juggle with figures and with the hopes and the future of workers in that way.

Mr. Peter Walker: Since, as the hon. Gentleman says, I said in my Press statement on steel modernisation that these would be sustained and created—which in fact was part of my first statement to the House—it is outrageous that he should suggest that the House was deceived on this.

Mr. Varley: I am only saying that, again, when we asked this afternoon how many of these jobs would be created—we on this side accept the investment programme in steel making plant and so on—the right hon. Gentleman's use of words smacked of cosmetics. If the British Steel Corporation can tell me, for example, that it cannot say for certain whether one new job will be created, why does the right hon. Gentleman use language like that?

Mr. Walker: If a firm's order book in civil engineering and other sectors in which it is interested is doing badly, those jobs might be sustained by this BSC programme. If it is doing well in other sectors, jobs will be created by the programme. Of course the Corporation cannot say, with any accuracy, that they will be sustained without knowing what is going on in every other industry.

Hon. Members: You said it.

Mr. Varley: In column 1580 of HANSARD on 21st December the right hon. Gentleman said:
As to the 75,000 jobs created…"—[OFFICIAL REPORT, 21st December 1972; Vol 843, c. 1580.]
That is what he said on that day.
The only thing that I am saying is that it is indecent to juggle with words to raise false hopes in the way that the Secretary of State does. We certainly want to know more about the new jobs for the steel workers who may be displaced. The right hon. Gentleman mentioned the


advance factory programme, although Shotton has been mysteriously excluded from that. Advance factories by themselves, although extremely welcome, will go nowhere near solving the problem on the scale that is likely.
The Secretary of State has constantly made play with his comparison of the expected redundancies under this strategy, and he did it again this afternoon. This again is in his statement and it is another example of how he used words in that statement. At first, he pretended that the net job losses would be only 30,000. Subsequently, in a rare and welcome moment of frankness, he admitted that they would total 50,000. But he seemed to suggest that even those 50,000 were chicken feed compared with the 404,000 job losses under the last Labour Government.
Of course, those 50,000 are in steel alone. The 404,000, as the right hon. Gentleman admitted, were over a whole range of nationalised industries. But he knows that, even after those 404,000 jobs were lost, unemployment under the last Government finished at 555,000. These 50,000 forthcoming redundancies will be piled on top of 823,000 unemployed. That is the unenviable achievement with which we can credit this Government. Unemployment under the Labour Government was certainly far too high, but our regional policies at any rate softened the impact. This Government had no regional policies after October 1970, because they abandoned them until the Budget of 1972.
But at least the right hon. Gentleman is coming along to some extent. I should like at least to compliment him on the speed with which he repudiated the Minister for Industry on the subject of diversification of the BSC. When asked last month in our debate about the Government's attitude towards joint ventures between the British Steel Corporation and private enterprise, the Minister for Industry confined his approval to ventures which, as he put it,
…will be complementary to the activities of the corporation…
When pressed by my right hon. Friend the Member for Cardiff, South-East (Mr. Callaghan), the Minister budged just a little, saying:

I do not close my mind, nor will my right hon. Friend, to joint venture projects, particularly if they have a complementary connection with the corporation's main-line activities.
Then he spoiled it all by adding:
I believe the effort should be concentrated. The cobbler should keep primarily to his last."—[OFFICIAL REPORT, 25th January 1973; Vol. 849, c. 699.]
The Secretary of State, I am glad to report, has no such inhibitions. On television on 2nd February Lord Melchett made it clear that the BSC is interested in the possibility of joint ventures. The Secretary of State, who took part in the same programme, was asked by Mr. Robert Mackenzie:
But is not that something that the Government has discouraged—that is, nationalised industries going into joint exercises which are outside their immediate purpose?
The Secretary of State was suitably indignant at such a reactionary thought. He said:
No, not necessarily. Where they have been sensible and have the management resources to do it, this has not been discouraged.
Later, he said:
But I personally do not want to look at this in a doctrinaire way. I want to look into what is positively good for these communities and for the British Steel Corporation.
No one on this side could have put it better.
Then, reading what the right hon. Gentleman had to say at his Press conference two weeks ago and also studying the White Paper, I got the somewhat unnerving impression that it was he who personally nationalised the steel industry against the opposition of a backward-looking Labour Party. No Labour Cabinet Minister could have denounced steel under private enterprise more scathingly than the right hon. Gentleman, when he described it as
…a scattered, disparate industry, rapidly falling behind its competitors through inadequate investment.
The White Paper told us, in paragraph 16, how nationalisation brought to the British Steel Corporation a large number of works with obsolete technology and low productivity. That is the inheritance which the British Steel Corporation is having to sort out. That is the industry to which the workers in the steel communities were bound and from whose inadequacies they have to suffer today.
Therefore, while placing on record our bitter criticisms of the way in which the Government have mishandled the BSC over the last two and a half years, we at any rate welcome their belated acceptance of its nationalised constitution and structure and its future as an expanding, publicly-owned industry. But we would like the Government to take a still more positive attitude. We should like them to understand the feelings and fears of steel workers in their close-knit communities, which depend on steel for their very existence. We would certainly like them to examine, genuinely and carefully, the representations—often fully documented and researched—which are being put forward by steel communities. We should like a positive attitude towards providing new employment and dealing humanely and compassionately with any casualties which may in the end be unavoidable.
These are human beings, communities with rich and irreplaceable traditions, not just digits on the pages of a White Paper. It is on their behalf and in their interests that we have tabled this amendment, and it is on their behalf and in their interests that we shall be voting tonight.

5.19 p.m.

Mr. Patrick McNair-Wilson: Of course, any debate on the restructuring of a great industry will have a large content dealing with the problems of those whose livelihoods are to be endangered. The hon. Member for Chesterfield (Mr. Varley) was Minister of State, Ministry of Technology when the coal industry under his Government was being decimated. Of course it is right that we, as the House of Commons, should regard most seriously the effect that these changes will have on individuals. I was surprised that the hon. Gentleman did not get beyond this point and did not examine the more significant proposals for the shape of the industry over the next 10 years.

Mr. Dennis Skinner: Window dressing.

Mr. McNair-Wilson: To say "window dressing" without studying the implications for the whole economy of the country is a facile remark.
Looking at the size of the British steel industry during the period 1955 to 1970,

we see that the demand for steel grew at only 1·7 per cent. and that there has been a flat growth in the industry over a very long time.
The Government, in collaboration with the British Steel Corporation, are taking a substantial gamble on the future size of the industry. To push up this target figure from what it was when I was with the British Iron and Steel Federation to the sort of figure that it is today—up by another 11 million tonnes—is a matter which will have a profound effect on the future of the industry.
I do not quarrel with the size of the investment. It is obviously gigantic—the biggest that the industry has ever seen. My quarrel is that today we should allow this investment programme to slip through our fingers without asking ourselves the question: is the Corporation entirely right in the way that it intends to develop this programme? I think that we must ask ourselves the questions: are we to get value for money? Have we embarked upon a policy of putting too many eggs into very few baskets? And—a matter to which I shall come later—are the safeguards written into the White Paper for that quarter of the steel industry in the private sector real or imagined.
Regarding value for money and eggs in one basket, I merely quote from paragraph 10 of the White Paper which states:
But for bulk steelmaking the large modern blast furnace and the basic oxygen process are likely to hold sway for many years".
When I was in the steel industry in the 1950s and early 1960s I was familiar with the criticism of the industry, as it then was, for investing too much money in the open-hearth furnace when, in 1947, the oxygen converter, after its proving trials in Austria, was showing the way to a totally new technology for this industry.
Looking at this programme and basing ourselves exclusively, as it appears, on the basic oxygen process, I wonder whether we could be in danger of falling into the same trap into which the industry fell in those years of open-hearth investment. Technology in this industry is moving fast and so many changes are taking place that I think we must retain an element of flexibility. I am not suggesting that the existing direct reduction plants are


likely to supersede all the plants at present operating in this country and elsewhere. However, I suggest that they are now providing a significant contribution to steelmaking in many parts of the world.
Some hon. Gentlemen may ask: "What about the Japanese? Why do they not do it? They are big and successful." I suggest that it is because the Japanese do not have any natural gas.
If we can go to direct reduction the savings in capital costs and the tremendous contribution to the environment of the area of the plants are indeed great. With the hon. Member for Chesterfield, I have been to the Korff Stahl AG plant in Hamburg and seen the clean air around the plant—something which we do not see around steel plants in this country. This new technology could be of significant importance.
Many other technologies are catching up on the industry all the time. I have here a small plastic bag of what looks like pelletised iron ore. These pellets are made up from blast furnace and oxygen furnace dust. They are bound together and can be fed straight into a blast furnace using those waste products which are found round every plant, burning a nice clean charge.
I move to the question about all our eggs in the one basket. Paragraph 10 of the White Paper goes on to state:
and the economies of scale at large coastal works are such that in most circumstances there is a significant saving in concentrating production there".
I cannot quarrel with those words, but implied in them is that the whole of our steel producing capacity should be in large works. I question this philosophy. Even at its worst, our steel industry is seldom less than 60 per cent. employed. The top 40 per cent. can disappear in bad times, but we are left with a base of about 60 per cent., which scarcely gets used. We need flexibility for that top 40 per cent. This is the key area of profitability. It is also the key area when it comes to taking up the cyclical slack which the industry so frequently has to endure and enables it to take up the demand which is forced upon it.
Given that the situation I have described is accurate—I believe that my figures are near enough—I suggest to my

right hon. Friend that we should think most carefully about the production of that 40 per cent. Here I introduce the word "modularity". I also introduce that now disparaged group of words "mini-mill". We need those types of flexible, smallish units. After all, we are talking about a million tonnes, plant which is not insignificant. We need flexibility of steel production, rolling, and re-heating plants—all the complex of manufacturing techniques required by this industry. If we ensure that the top 40 per cent. can be financed in such a way that we do not have the major capital cost of a great big site which, when that 40 per cent. disappears, leaves us hanging on to a lot of plant which we cannot fully utilise, then this comment in the White Paper could be wrong. I hope that my right hon. Friend will carefully examine the arithmetic regarding the total 100 per cent. realising that it is the 40 per cent. at the top which is more significant than anything else.
I come to my penultimate point which concerns the private sector. Paragraph 38 of the White Paper is headed "The private sector". I find this paragraph somewhat inconsistent. It states:
The private sector supplies about a quarter of the United Kingdom's requirements".
I do not quarrel with that. I do not think that anybody would. It goes on:
The Government are satisfied that the BSC's investment strategy does not threaten the place of the private sector".
The investment strategy may not threaten the place of the private sector, but the pricing strategy of the British Steel Corporation does. This has been amply borne out by the recommendation in Lord Hirshfield's report. It is unfortunate that the Questions that I put down for Written Answer yesterday have not yet been answered—there are no doubt good reasons for that—because they centred around what the Government intend to do to restore the situation to which Lord Hirshfield referred. I believe that the private sector is of great significance.
My hon. Friend the Minister for Industry, in an intervention during my speech on 25th January, referring to Lord Hirshfield, said:
those recommendations were accepted by the Government and the British Steel Corporation,


which said that it would take full account of them."—[OFFICIAL REPORT, 25th January 1973; Vol. 849, c. 752.]
I still have to find out exactly what that means. I am not aware that it means anything. I believe that this is a significant handicap on the private sector, which is part of the British steel industry and cannot be dismissed as a group of people to whom nobody owes a living.

Mr. George Lawson: The hon. Gentleman is talking about the private sector, which is overwhelmingly the stainless steel, special steel, sector. We have heard a great deal of condemnation of the bulk steel, nationalised, sector. Doe not the hon. Gentleman agree that Britain has been let down much more by the stainless steel, private, sector, than by the bulk steel sector? Why should we be so concerned about the private sector?

Mr. McNair-Wilson: The hon. Gentleman and I have debated steel subjects before. His view and mine about the private sector may be different, even with regard to stainless steel. The contribution of the big companies such as Guest Keen, Nettlefolds to British industry is very significant. I am advised that as a result of the interference with pricing policy they are losing about £1·6 million a year, which is a significant disadvantage
Perhaps the hon. Gentleman and I can discuss the matter on another occasion, because I want to move on to my next point about the private sector—its ability to finance the new plant referred to in paragraphs 38, 39 and 40. By their tremendous generosity to the British Steel Corporation, the Government are now creating two industries within the single steel sector, one of which receives a great deal of Government finance while the other has to raise its money in the open market. The White Paper says:
The Government welcome such moves,
—referring to the private sector modernising itself—
and will be willing to consider proposals under the Industry Act 1972 for assistance in appropriate cases.
Can my hon. Friend the Minister give us an idea of exactly what he has in mind?
I should like to add another word of caution on the question of the Japanese samurai, the great Japanese steel giants, who have been cutting down to size industries like our own and making life very difficult. They are likely to find life becoming more difficult for themselves. The currency revaluations taking place across the world will alter the trading performances of many nations. The Japanese have appeared to be the ideal in steel industries, and I have been as guilty as anyone else in believing that But they could well find themselves having a great deal of steel on their hands which they find very hard to shift.
That would have two effects. First, it would make other nations like ours much more competitive. Secondly, while I welcome the fact that we have set aside a vast sum of money to re-equip our industry, my hon. Friend might consider that there is perhaps no need to do everything overnight, that where plants are working effectively and efficiently and jobs are being enjoyed we should not necessarily have to sweep everything away to catch up with our great competitors like the Japanese. It may be wiser to spend our money more gradually, perhaps taking account of some of the points made by the hon. Member for Chesterfield, allowing those plants that are doing a good job to serve a bit more of their useful life.
It is our job to husband the taxpayers' money carefully, to make sure that it is not squandered. The White Paper gives us a marvellous opportunity to modernise the industry. That is what we want ultimately to do, but, to meet the point of social cost, let us recognise that we do not have to limp along behind the Japanese to be a successful industry but that we shall and can be thoroughly competitive with much of the plant that we have today.
The White Paper is a good document, the most encouraging that the steel industry of this country has ever seen. But we must examine very carefully the implications of some of the rather simplistic language in it, so that we make sure that we do not squander the taxpayers' money, and that we obtain value for them.

5.35 p.m.

Mr. Ted Leadbitter: The hon. Member for New Forest (Mr.


Patrick McNair-Wilson) began his speech quite well, and I have no need to take issue with him, except on his last remarks. I do not think that the White Paper is a good document. We must compare the performance that it expects with what is happening elsewhere in the world and the projected figures for world steel production during the next decade, the period with which the White Paper is concerned.
The hard fact is that world steel production capacity is about 690 million tonnes and is expected to be about 939 million tonnes by the end of the decade. The projected figures for world steel consumption are of that order. By 1985 consumption is expected to rise to 1,144 million tonnes, compared with the present level of about 595 million tonnes. We are talking of nearly doubling world consumption in the next decade, and nearly trebling it as we approach the second half of the 1980s.
What is this country doing about that situation? We are considering increasing production from 27 million tonnes to 33 million—35 million in 1975, and possibly reaching 36 million—38 million by the first half of the 1980s. Let us compare those increases with what is planned to be done elsewhere by 1975. West Germany is seeking to increase her production by 9 million tonnes by then; Japan by 28 million tonnes; and the United States by 25 million tonnes.
Compared with the rest of the industrialised world, Britain's planning looks poor and dismal. On that account alone we should examine the whole problem again. My hon. Friend the Member for Chesterfield (Mr. Varley) was right to recall the 43 million tonnes target figure, which was more realistic in view of the projections of world consumption and the planning of other countries.
The Secretary of State made great play in his speech of the suggestion that investment in the industry was poor. He was trying to make a political point. I do not seek to do that, but simply to address myself to the hard facts. In the middle 1960s investment was running at about £130 million a year. By 1970 it had doubled. By 1971 investment in the whole industry, including the private sector as well as the British Steel Corporation, was over £400 million. Talk of a 10-year programme recalls to me the

health service 10-year programme announced in 1963, just before we came to power. A 10-year investment programme of £3,000 million, must be considered realistically. It is an average of £300 million a year. I suggest that this does not reflect what the industry requires, and certainly I would go for the figures which Melchett brought out some 18 months ago. We should be talking in terms not of £3,000 million but of nearer £4,000 million of investment over the decade.
I deal now with the period and not just the investment and the projections of steel demand. Who in this House or anywhere else has ever decided that it is possible to have a strategy for 10 years in the steel industry? Who has ever been able to plan more than three, four or five years ahead? In my constituency the British Steel Corporation built a 20-inch pipe mill. It was established in March 1968 and it has not worked satisfactorily since. Men have been taken on. Men have been laid off. At the moment only one end of the mill is working and in January of this year a further 175 redundancies were announced. In July 1968 the corporation established a 44-inch pipe mill. That, too, has not worked satisfactorily. In 1967 the planners said that they could establish two pipe mills essential to the industry and they were able to claim that they were planning well ahead. Now they are talking about closing them.
The British Steel Corporation has not made out its case purely on a general strategy here because it has been hampered for two years by the present Government. There are many people in the industry with a great deal of experience who agree that it is not possible to go beyond four or five years in planning.
Let us take the Consett Iron and Steel Company. According to the Benson Report which was before a number of hon. Members several years ago, that company was due to be closed. Only 18 months ago when some redundancies were announced I asked a number of questions about the company. It was judged to be a low-cost production plant and was not due to be closed. Now a black mark is on it again.
The oscillations and fluctuations in the industry are such that my submission


must be that there is no room for a rigid final posture on the White Paper.
I return to my constituency, and I refer as I must to the intention to close the plant there, where at the highest point of employment some 6,000 people were working and where about 4,750 are working now. The position is that if the White Paper programme is carried out in the Hartlepool constituency we shall have at least 2,800 people deprived of their jobs by 1975–76. At the moment 3,225 people are out of work in the constituency. In addition if the plate mill goes we shall lose the difference between the 2,800 people and the 4,750. The total unemployment position in The Hartlepools therefore will be very black.
To give some idea of the magnitude of the problem and why I am asking the Minister and will ask him again after the debate to look at the problem, I need only remind the House that we have 70 men and boys out of work for every vacancy recorded in the exchange area. Of the 35 employment exchange areas in the northern region 29 have fewer than 22 men and boys out of work for every vacancy registered in their areas. In the northern region, which as a whole has a very unfortunate record, we in The Hartlepools are very seriously placed.
We are used to it, of course. When I came to this House in 1964 we had the highest unemployment figure in the whole of the United Kingdom. If the Government are not careful I shall be fighting the next General Election on the basis of the highest unemployment figure again. Whatever the Government say in the interim, during the period when the Labour Government were in office 7,000 new jobs were given to us. The input of new jobs in the northern region was 15,000 a year. In an earlier intervention I pointed out that since June 1970 redundancies in the northern region have been running at the rate of 2,000 a month. That is the sad situation.
I come then to the rest of the plant at the Hartlepools. Let me point out to the Minister that in 1960 the South Durham steel plant was commissioned for £50 million. In March and June 1968 two pipe mills were established at a cost of £11·2 million. In a decade some £61·2

million was invested in a plant producing steel with a total capacity of 1 million tonnes a year. At the moment it is producing 18,000 tonnes a week working at 90 per cent. capacity. Is not it stark raving madness, with a plant which is just over 10 years old, to have arguments about closing it? Is not it economic madness?
A considerable amount of public money is involved. I was a member of the Standing Committe which considered the Steel Bill, and I took part in advocating acceptance of the principle of a public capital dividend in order to remove the great burden of capital debt from this industry which, according to the White Paper—the Secretary of State was reluctant to say so, but it is in the White Paper—was an industry which had been taken over and nationalised by a Labour Government, an industry with a very bad financial base and an industry with obsolete plant.
When we get round the table to see how best to ease that burden, bearing in mind the other plants of this kind with such recent capital investment in them, it is the madness of political prejudice and nothing else which can arrive at a decision to say to 4,500 men that their jobs are finished.
It is no good the Minister saying, "But what about the multi-million pound Red-car complex which will be producing a third of British steel when it is built." I happen to be discussing redundancies which are earmarked to take place in 1975. The plant at Redcar will not be built until 1980. What are my men to do? What can the Member for The Hartlepools do in the circumstances but say to the Minister, "For goodness sake listen to your colleagues, especially to the hon. Member for New Forest, who talk about not putting all our eggs in a few baskets".
There is a fallacy abroad that basic oxygen steel is a new concept. It is not. It is as old as the hills. There have been many forms of oxygen processing over the years, even since Bessemer. But since 1945 when bulk oxygen was able to be produced, we have been able to bring this into the steel-making context. But I never thought that it would be done on the basis of one process nationally in huge plants which would create many difficulties. There should be


an attempt to think in terms of a modernisation of the industry with a reasonable mix. The natural processes arising from management producing that kind of mix are there for us to see. They did not come about through a White Paper.
In 1970 open-hearth production accounted for 47 per cent. of total output. Last year the figure was 35 per cent. Now we are producing only about 8 million tonnes with that method. Experiments in the rest of the world are brushed to one side by Lord Melchett, yet they are production successes which prove that the open-hearth method has a place in future.
I make a submission to the Minister. I ask him not to be too rigid with this strategy. Let him bring some resilience into his thinking. Let him listen to Members of Parliament who have some experience and to the trade union movement. Let him also listen to those who know the position in the constituencies. He cannot justify any kind of reorganisation if it is not balanced with a true and effective consideration for men and their families. If the Minister will give this undertaking we can have a dialogue which will satisfy us all.

Mr. Deputy Speaker (Miss Harvie Anderson): Order. I hope that hon. Members will realise how many wish to take part in this debate.

5.52 p.m.

Mr. David Crouch: We have been reminded of how important this debate is for so many constituents. The House knows that I do not have constituents involved in the steel industry but I am nevertheless greatly interested in the White Paper and in the industry. My hon. Friend the Member for New Forest (Mr. Patrick McNair-Wilson) gave the House and the Government Front Bench some helpful and constructive thoughts about this £3,000 million investment. I propose to do something similar.
The problem facing us is not so much bound up with closures and redundancies as with modernising a basic industry and providing new jobs for those displaced. That is a quite different thing. These are equally essential factors. Modernisation must be slowed down if we do not produce the jobs for the men so displaced. It is not beyond the capacity

of Government to do what is required of them.
In these days of anti-laissez faire which rightly epitomises this Government, when the Government have chosen to entervene responsibly in the economy and in industry this situation is a special challenge. The Government have a responsibility to see that they march ahead, modernise and produce new jobs. We are not talking about one industry but about modernisation of an industrial sector. I hope that what I am saying might even be reported in Hanoi so that the right hon. Member for Cardiff, South-East (Mr. Callaghan), whose presence we miss today, might be aware of it.
I spoke on 25th January and touched on the proposal to close the East Moors site. This poses a problem. Representations have been made today and earlier about this. Cardiff's problem is much bigger than merely being faced with the closure of East Moors and the displacement in three years' time of 4,500 men. Cardiff Corporation see this closure leading to the unemployment of 15,000 men. There is a case for the Government granting special development status to Cardiff.
I turn to the private sector position in Cardiff. East Moors was once part of GKN, which retains a large investment in Cardiff. GKN wants to continue there and enlarge on that investment but it is dependent on certain factors. It is not dependent on the East Moors site continuing, although the men say that they cannot see why it should not. I accept the argument that it would be more economic to produce steel billets for re-rolling at the GKN plants at much larger plants than East Moors.
It is proposed that eventually the supply to GKN should be coming from the great Anchor development about to come on stream. GKN would like to increase its investment in Cardiff by as much as £30 million. We are talking about an investment of £300 million for the nationalised sector yet here we have the not-so-small element of GKN in the private sector thinking in terms of £30 million. It cannot do this unless it gets a return on its investment. I return to what my hon. Friend the Member for New Forest said when he spoke of the price factor. This is an essential factor


when considering investment. We must think of the industry, private and public sector, becoming viable.
GKN could make this investment at Cardiff and meet Lord Hirshfield's recommendations dealing with a more sensible price structure for steel. Cardiff would be greatly helped by the granting of development area status. It would make a difference of as much as £6 million or £7 million in investment. We cannot lightly cast aside the intention of GKN to help increase steel production without taking that factor into consideration.
We cannot push to one side consideration of prices even though we may be in the difficult period of phase 2. On 1st April we shall be faced with a crucial choice. It is then that the European Coal and Steel Community will have an opportunity to question our whole pricing policy in this industry and maybe to request that we raise our prices to match those on the Continent. I hope that the Government will take the initiative here and at least make a statement before 1st April so that the entire industry knows where it stands rather than that it should suffer the indignity of being hauled before the International Court at The Hague to explain our new position.
An interesting comment was made by the Chief Secretary about prices in the Committee dealing with the Counter-Inflation Bill last week. He was asked: where did the final decision lie? With the House or the ECSC? In a long answer from the Chief Secretary I understood him to say that, notwithstanding any decisions which may be made in Committee, we cannot break our obligations under the European Communities Act.
On the question of price, I think that the non-implementation of Lord Hirshfield's recommendation is costing all steelmakers, including the BSC re-rolling side and special steel side, and certainly including the private sector, a great deal of money. We cannot go on in this way. It is so bad that the Secretary of State might well be in the position of being asked to pay some compensation to a private sector suffering so seriously in this way.
I should like to make one last point on price. The BSC's policy on prices—

influenced, of course, by the Government—is having the effect of squeezing the private sector, because the BSC is the producer of 90 per cent. of the steel billet in this country and 75 per cent. of special steels, finished steels and re-rolled steels, and by increasing its billet prices in relation to prices for re-rolled products it has so squeezed the profit margins of its competitors as to make the business extremely unprofitable for them.
I cannot see that this situation can go on. Lord Hirshfield recommended a price increase of around 4 to 5 per cent.—and I quote from his report:
…that a commercially acceptable rate of return be earned and also that the Minister consider the desirability of reviewing the extent to which it is proper for BSC to compete with the private sector in this area of the industry.
My hon. Friend the Member for New Forest spoke of his concern lest we become over-impressed by the whole concept of bulk production at coastal sites. I must say I have my reservations, too, but from inquiries that I have been making, particularly in regard to the carriage of ore by sea and land, I have been impressed by the enormous scale on which the carriage of ore is now being contemplated. In the past 20 years this has changed out of all recognition. In 1950, the ship ore-carriers chartered by the British Steel industry were of the order of 15,000 to 20,000 tonners, but today the BSC is chartering ships of 100,000 tons to carry ore. Port Talbot can take vessels of up to 150,000 tons; Teesside can take vessels of up to 150,000 tons: and Hunterston, if it comes into being, will be able to take vessels of up to 400,000 tons.
I find also that there is developing in the carriage of ore, oil and coal, a new version of the triangular trade of another century. This is such that is is having a very great influence on the reduction of the cost of the carriage of ore. We have today, for example, the carriage of oil from the Persian Gulf to Japan, and the same vessel, having unloaded the oil in Japan, travels empty to Australia, where it is loaded with iron ore, probably in slurry form. The iron ore is taken from Australia to the United Kingdom, then the vessel goes empty across the Atlantic to the United States, where it fills with coal for shipment to Japan. Then it starts all over again on the triangular or circular road from Japan.


This is making it possible for the carriers to negotiate very low prices for the transport of ore and it is one of the major factors which make it very attractive to think in terms of the development of large coastal sites—and I do not argue with this.
However, it is also possible to move ore on land very cheaply. New techniques are being examined in the United States, and particularly in California, of putting ore in the form of slurry and pumping it across long distances. This is being done in California, Chile, and Tasmania, across distances of 30 to 40 miles. We must not neglect this opportunity to transport ore cheaply in this country—and it can be transported cheaply.
I see no mention of technicalities of this sort in the White Paper. I have no complaint about that, but I maintain that we should think about this pumping of ore, because it will mean that it will not be necessary for us to have deep-water harbour facilities and dock facilities. With this type of process it is possible to pump to a terminal for front-end loading, as with off-loading oil from a vessel harboured in the roads, as it were, and not necessarily in the harbour. It is possible in this way to envisage the use of this essential raw material in many other places in this country.
There is an overpowering argument today for BSC to go big in its modernisation plans in order to be viable and competitive internationally. The economics of producing liquid steel in massive capacities can look attractive at first sight, but this needs further examination, because we must remember that in this country we are not concerned only with liquid steel or steel billets; we are also concerned with steel being turned into about a thousand different versions, in rod and other forms.
It may be that the rationalisation we shall have to see in this country is the reduction of that thousand to a much lower figure in the future. But that is something which must also be examined as we consider the modernisation of the industry. It is nevertheless a fact that it is this great versatility in producing special steels that is part of the special character of our great tradition of steelmaking, particularly in Sheffield, for example.
On this question of economics, I am told by the British Steel Corporation that it considers that the Anchor site will have an economic advantage over the normal small-scale plant of about £8 a tonne, and that even the freight cost of transporting it across country, for example, from Anchor to Cardiff, would add only approximately £2 a tonne. There we have the argument in favour of a large-scale operation, which I accept.
I should like to say a few words about the private sector because paragraph 38 of the White Paper mentions the continued vigour and prosperity of the private sector. Of course, there are only three paragraphs about the private sector, and I make no complaint about that. I should like to refer to what I said earlier. We must see that the private sector is not squeezed out on price. It must be placed within the general strategic plan and not left outside to try to catch up as best it can.
I must say something in criticism of the private sector. It must show that it has the vigour to prosper in this new advance the steel industry is making. What I mean by that is that the private sector is a sector not only of steelmakers but also of the private sector of investment in this country. I want to see the City taking an interest in the private sector of the steel industry. I want the private investor to begin to get some confidence and to come in and back this industry. Here is a chance for the Bentleys, the Barclays and the Broakes to show that they want to take the opportunity to enlarge and develop this basic industry.
As regards the public sector, the British Steel Corporation, I have not been happy with its relationship with the Government. This is not to make an unfair criticism, because the relationship between the nationalised industries and the Government is never an easy one, whichever Government is in power. But I have the feeling that the British Steel Corporation resents very much interference from the Department of Trade and Industry. It seems to react badly. It seems sometimes to go into a bit of a huff. It cannot avoid having a sponsoring Ministry. It cannot avoid having the Treasury and Parliament taking an interest in its affairs. It has to work with them and to satisfy them. But I


believe that it must change its attitude, it must be more open, it must tell us more, and it must stand up to its Ministers and, above all, to the Treasury. It owes that to itself, to its workers, to the investors in this country and to the House.
We may have to consider a better way one day of financing the British Steel Corporation and giving it a financial discipline, perhaps away from the Treasury and I hope, at the same time, a greater incentive. By all means let us have a degree of interrogation and interference by the DTI in the technical details of the Corporation's affairs. The BSC now has, in my opinion, a great opportunity. It has the great good will of the public and Parliament behind it. Of course there is concern about the redundancies that must grow out of this big change we are proposing for it. But there are good foundations for the industry and for the British Steel Corporation. Already the Corporation has done two things which are memorable. It has worker directors, and that is a process which is developing well in the corporation, which is encouraging in a major industry. There is within the TUC a steel committee working as an extremely valuable consultative body with the BSC management. We therefore have a framework of a very good industry and I should like to see it get into calmer waters of greater confidence so that it can expand and, with greater encouragement, improve its morale. If ever an industry needed to increase its morale, this is it.
I should like to see less interference from the DTI with more responsibility placed on the corporation for its commercial success.

Mr. Speaker: May I make another appeal to the House? About 15 hon. Members want to catch my eye and there are about 150 to 160 minutes left for the debate. That is a fairly easy calculation to make and if hon. Members confine their remarks to 10 or 15 minutes I should be able to call almost everybody.

6.14 p.m.

Mr. John Morris: Tomorrow morning the hon. Member for Canterbury (Mr. Crouch) will have the unique experience of finding some of his

earlier comments about Cardiff welcomed in the capital of the Principality and in the capital of North Vietnam at the same time.
It would be churlish of me, at the beginning, not to mention two aspects of the Government's proposals. The first is the commitment of £3,000 million—a massive investment for the future. Certainly the Government, in steel and other matters, display a gargantuan appetite for the extension of public ownership, and this will warm the cockles of the hearts of every little voter in Reigate and Cheltenham where all the great battles of steel nationalisation were fought in the 1950s and the 1960s. We are glad that the former Secretary of State has been removed to quieter European pastures, because it was he who made the famous and welcome disengagement speech at the Tory Party Conference in 1970. No lame duck the steel industry: it is a worthy animal, according to the Government, to be fed in abundance with quantities undreamed of.
The Secretary of State made a cheap debating point when he dealt with the low investment of the mid-1960s. My hon. Friend the Member for The Hartlepools (Mr. Leadbitter) has dealt with that point. The inheritance of 1967 was spelt out in the White Paper—financially weak companies with low productivity and with obsolete plant. As soon as the corporation began with its corporate plan we witnessed increased investment, year by year, at a rate of 50 per cent.—substantial investment. Anyone who has been taking part in steel debates or has taken an interest in the subject will recall how private industry failed, and that it was the public purse that had to expand investment in the difficult years at Llanwern, and Colvilles in Scotland.
The Government's judgment of last April has been stood on its head. After nearly two years of inquiries, joint steering groups, and all sorts of weird animals crawling through the hair of the British steel industry, there is now the judgment of—and the word "mini" is popular now—a mini-Solomon. Last April the target of capacity by 1980 was endorsed by the Government as between 28 million and 36 million tons. The Government preferred the lower end and said that the British Steel Corporation was veering towards


the top end of the bracket. Well, the veering has won. The poor drunken corporation, pushed from pillar to post, has won the battle. Now there is a complete change in Government attitude—a change that they would be frank to acknowledge. The target is now to be between 33 million and 35 million tons by the late 1970s and a higher figure by the first half of the 1980s. I hope that Government supporters will note that we are to have massive public ownership, coupled with the maximum of misery in many steel areas. I am concerned with the brutality with which those who will suffer job losses have been rejected.
The steelworker is a quiet, moderate and responsible person. However hot the political battles in the 1940s, the 1950s and the 1960s, he got on with the job of producing steel. In my constituency we had redundancies in the 1960s. Between 3,000 and 4,000 men have already gone from Port Talbot. There were negotiations and consultations—real consultations, because the interests of men and women were concerned—and productivity agreements were reached. Rundowns are nothing new to us; we have had them already. They were accepted because steelworkers were confident that new money would come in, along with new industry. The original plan put forward by Lord Melchett for a production figure of 43 million tons would have required investment at the rate of £4,000 million. With some of that the misery could have been saved. We have heard warnings in the course of the debate. Is it wise for the Government to put so many eggs in so few baskets? The British Steel Corporation is not omniscient, and even the most Uriah-Heepish of the Government's back benchers would not say that this is an overwhelming trait of the Government. That is perhaps where a word of caution is necessary. I represent Port Talbot and my constituency will be one of the major beneficiaries of the plan. I believe that the plan, in terms of its broad philosophy and aims, is substantially right. The aim must be for bulk production to take place on coastal sites, but I am worried lest, in such a short time scale, there should be a total dependence upon these major producing centres.
When major investment took place in Port Talbot it took a few years to achieve the record successes of the last couple of years. We had teething trouble after teething trouble. Now we are confident that we can take in as much of the expansion and investment as we can have, but only because we have sweated blood and tears to achieve our present expertise. I do not know whether other areas will be able to achieve a similar record with total dependence upon these producing centres, as specified in the plan. I accept the broad philosophy of the plan because its purpose is to make steel which can be sold in world markets. If we can get basic steelmaking right and produce the goods at the right price, all other matters will fall into line. We are talking in terms of a saving of a little less than £10 a ton. That is the kind of economy that can be achieved if we can get steelmaking right.
What concerns me is the total dependence upon the plan and the lack of any insurance if something goes wrong at any of the major centres, which may lack the experience or the tribulation that those in my area have gone through over the years.
I want briefly to examine the figures. My hon. Friend who opened the debate very kindly drew attention to a Question I put down yesterday concerning the way in which the £900 million is to be spent in Wales. I dare not query how the £3,000 million is made up, but, in my experience, one does not put figures of this kind into a White Paper before they are tested and cross-examined, since one wants to ascertain that there is some basis for them. One does not capture figures from the air and put them in a White Paper. That was why, when criticisms were made in the last two weeks, I sought to exonerate the Government—until yesterday, when, in answer to my request for a breakdown of the figures the Minister replied in the terms read out by my hon. Friend, which I will not repeat at length. The Government then sought to indicate the position.
The £900 million was covered first, by projects already in progress or announced. Well, what are they? I analysed them in the debate on 25th May last—Llanwern, £90 million, and Port Talbot, £45 million. Of this, £80 million


had already been approved at Llanwern and £20 million at Port Talbot. Therefore, there was only £35 million of new money. It is quite a long way to go from there to the £900 million that we are talking about. Those are the projects that have already been announced.
Secondly, there are those mentioned in the White Paper. Not a single figure for Wales is given in the White Paper—save for the cost that would be incurred in modernising Shotton to bring it up to the same standard as Port Talbot. The figure given is £200 million, but not one figure is given in the White Paper with regard to £900 million for Wales. Who is the Minister seeking to "con"? What whitewashing have we here? Those are the only figures mentioned in the White Paper.
Lastly, there was a reference to the
high level of continuing investment for modernisation and replacement.
That seems to be an exhortation against sin. I very much hope that when the Borrowing Powers Bill comes before the House the Minister will be better armed than he is now, because we shall be analysing the Bill, clause by clause and line by line, and we will want to have some kind of assurance from the Government.
Regrettably, this is where the worry starts. The British Steel Corporation does not know any better either—or certainly is not prepared to admit it. A letter was delivered to me by hand today from the British Steel Corporation in which it said that it could not give the figures because the whole strategy as set out in the recent White Paper very much represented a "broad brush approach". That is all it could tell me. That is the kind of figure the Minister seeks to give the House.
The Secretary of State for Wales—who is not here—when speaking of the fact that he had failed to save Shotton and Ebbw Vale, beat the drum in a big way and was proud of the fact that £900 million was coming to Wales. He had not bothered to check, or to ascertain the time scale of the expenditure of that money, and where it is to be spent. This afternoon the Secretary of State sought to dismiss the inquiry of my hon. Friend the Member for Newport (Mr. Roy Hughes)

and myself, saying he could not bother to give estimates in detail. We are not asking for details of every nut and bolt; we want some indication or apportionment of where and when this money is to be spent. I can assure the Minister that this certainly would not have been good enough for any of the private or public companies with which he was concerned before he became a Minister. He would not have accepted a figure of this kind if his own company had produced it and said, "We will spend £900 million", in a "broad brush approach". Nor would the shareholders have stood for it. They would have wanted clarification, and we, in turn, demand it.
I make one other point, conscious of my hon. Friends' need. Our worry is that if the Government are so lacking in information about such large figures as £900 million and £3,000 million how can we be sure they know the facts, and how can we accept the assurances they have given to us about new jobs? If they are so unsure of the money involved how can they expect us to be persuaded that 1,300 new jobs will come to Port Talbot and 1,500 to Llanwern? In the same way, how can those who will suffer grievously in areas of Shotton and Ebbw Vale—or, indeed in any part of the country—be sure into which part of the country new jobs will come when they are required? That will be the acid test.
In my constituency, in a prime site almost on the forecourt of the station, with access to two new harbours—one of them brand new—and to a motorway, a factory of 75,000 square feet has been hawked from one end of the kingdom to another for the last two years, and no one has taken it. What steelworker, faced with a difficult situation in a remote part of the country, can accept the assurances of this Government, and all the blarney about task forces, the Government's recent conversion to advance factories, and their belated regard for development grants, knowing that a factory in prime condition in a prime site, and in an easily accessible area, has had no taker?
What confidence can people in difficult areas have when factories in good areas cannot be filled? The broad aim of the strategy must be right, but the Government are strangely lacking in facts and figures, and in the assurance which must be given to those who will be deprived of


their livelihood if we are to accept the Government's proposals.

6.28 p.m.

Mr. Emlyn Hooson: I am sure my right hon. Friend the Member for Aberavon (Mr. John Morris) would really agree that this White Paper really deserves a sub-title. The subtitle I suggest is, "How to be Precise, Yet Vague" because this is really what it is like. It is couched in most simplistic terms. It is, I would have said, a typical product of a huge corporation, responsible to nobody, knowing that in the end there is a huge public purse on which it can rest. It is merely proposing to spend £3,000 million without really giving any indication of how that money is to be spent. It is proposing a tremendous reshaping of our steel industry.
I am a firm believer in a mixed economy but I opposed the nationalisation of steel. The hon. Member for Penistone (Mr. John Mendelson) well remembers my opposition to the nationalisation of steel, but I am prepared to accept that the British Steel Corporation has greater expertise on steel than anybody in this House, whatever his expert knowledge. I believe it sat down and planned, with the most modern information available to it, what it thought was the best strategic concept for the future of British steel. Of course, that concept involves very difficult decisions—decisions that must hurt some communities: but this was bound to happen. I do not think that was avoidable once steel had been handed over to a nationalised body.
I do not happen to share this approach to these problems. I never believed that nationalisation would solve the problems of the British steel industry, and I do not believe it now. Let me give a typical example of its defects, from the speech given earlier by the hon. Member for Hartlepools (Mr. Leadbitter), who is no longer in his place—though I told him that I was interested in what he said. He informed the House that in 1968 two pipe works were created in his constituency—one to produce 20 in. and the other to produce 44 in. steel pipes. I checked the detail with him, though I have forgotten how many millions of pounds he said they cost. That was only in 1968, but one of those places is now closed completely while the other is merely ticking over.

What is wrong basically with a corporation which so fails when it has a captive market open to it?
This has happened in an area of considerable unemployment. This is expenditure of public money by a public corporation with no return to the public yet, as I say, we have a captive market in pipes. We have the North Sea project. But where did, and where does, the British gas industry get its pipes? From Japan, Germany and Italy. There is something basically wrong with the strategic concepts of a corporation which can open then close down works like that and yet fail to take advantage of a captive market.
It seems, therefore, that we must approach the White Paper with a great deal of cynicism. In the past we have had projections of developments that were to take place but that have not taken place. I know that members of the corporation were greatly impressed by what they saw on their visit to Japan in 1969. A colleague of mine, standing as a Liberal candidate in Flintshire in March 1969, suggested that the Shotton works were in danger of closure from one of the corporation's pronouncements on its return, and I am sure that he was right.
What the members of the corporation saw in Japan was impressive. In theory, that kind of development is probably right for this country, but will it be so in practice? Great technological developments are taking place in the steel industry; some have already been referred to—but I am against the concept of putting all the eggs in one basket. The trouble with a huge corporation like the BSC is that those in charge consider the country as a whole and not as, say, would John Summers, as a private enterprise at Shotton, where they would ask, "How can we best develop in Shotton?"
The BSC kingdom is huge. Those directing its fortunes have to look at the whole country. The Labour Government required them to do so! They say, "We will close these steelworks and go somewhere else", just as someone at Shotton might have said, "We will close this section or branch." The corporation is working on a very much larger scale. The result is that when a mistake is made it is a huge mistake, the consequences of which are tremendous. Therefore, there is a good case to be made for a


cautionary note to be sounded, particularly in view of the great social consequences of the strategy propounded in the White Paper.
I have no steel interests in my constituency, but in Wales no less than 7·7 per cent. of the male working population is engaged in steel. Those people will suffer a great deal, and the repercussions of what is suggested will be felt throughout the Principality. Though the strategy may be basically correct, there is a good case to be made for the Government and the corporation to look at the developments of new technology and ensure that there is scope for adaptation. There should be much more scope for flexibility than is set out in the White Paper.
It seems to me that in its overall strategy far too little attention has been given, for example, to the great tradition of good works relationships in such works as those at Shotton and Ebbw Vale. In this day of experimentation not only in the economy of the country but in social affairs and the evolution of ideas as to how industry should be run, could not at least one of the works now proposed for closure be run experimentally? One of the works where steel production is proposed to come to an end might be handed over to the whole range of workers from the shop floor to top management. Let them run the works with the help of capital which would otherwise be spent elsewhere, and let us see how it works.
I do not suggest that that should be done everywhere, but it could be done somewhere, and with proper leadership might well succeed. Such works as that at Brymbo produce steel very successfully, though relatively little capital is invested in them. There is no reason why Brymbo should be so successful, but it is. Shotton also was a very highly successful works though suffering perhaps many theoretical disadvantages.
We are in great danger of looking at the future of the industry as no private businessman would look at his own business. That man wants to rationalise, he wants to get the best results from modern technical advance, and he wants to site his factory properly. He must also have regard, as most people in private industry now do, to the communities involved in any changes. Would such a man really

go for a plan in respect of which, if it is wrong, there is no redress? We know that the members of the corporation were impressed by what they saw in Japan in 1969, but by the time of implementation in 1979 that may already be out of date. There is therefore a good economic case for modification of the approach and for allowing far greater flexibility, and a great social case for looking afresh at the whole of the proposals.
As I have said before, I was against the idea of nationalising the steel industry and leaving one corporation to decide its future and shape. The complaints heard from constituencies like Flintshire, Monmouthshire and Newport are the inevitable consequence of letting steel be controlled nationally and telling people that they must think of the industry nationally. The corporation was set up by a Labour Government. Lord Melchett was appointed by a Labour Government. His strategy was to be expected. The corporation's strategy was to be expected.
If I shared the views of the hon. Member for Sheffield, Brightside (Mr. Eddie Griffiths) I would agree, as he said in a previous debate, that the corporation's is the only logical and sensible approach, but that is in marked contrast to the views of some of his colleagues, who do share his beliefs but not his detailed views. They believe that there must be a far greater mix. The Government are in grave danger in accepting from this one industry a one-outlook, blinkered approach. There is not enough flexibility in that approach. The whole thing needs re-thinking.

6.39 p.m.

Mr. T. H. H. Skeet: The hon. and learned Member for Montgomery (Mr. Hooson) speaks of flexibility, but if he refers to paragraph 38 he will see that flexibility is read into the plan. That is the whole idea behind the £3,000 million. It is a matter of allocation of resources. The hon. and learned Gentleman himself indicated that technology can be outdated, so what is required is carefully to provide allocations while allowing scope for flexibility. This approach was clearly laid down in the Minister's reply yesterday when he spoke of allocations being made available for modernisation and replacement later.
I believe that Wales has been dealt with very responsibly. It gets one-third of the total investment. We have here a 10-year programme, and 10 years, both politically and economically, is a long time in which there may be quite substantial changes in technology. We are convinced that the oxygen process will have a long future, but there may be other improvements in technology after that. If we keep some funds in reserve they can be applied as technology changes.
There is a considerable increase in productive capacity at Port Talbot, an increase to 6 million tonnes. The production for the whole of Wales will be up to 9·8 million tonnes, which is a high figure for that part of the country. The strategy in the White Paper is that coastal sites will be considered, and I think that is right. It has been paralleled in Europe by Usinor at Dunkirk, Wendel Sidelor and Usinor at Fos, Hoogovens on the coast of Holland and Finsider at Taranto. The Government are following a consistent philosophy here. They have decided that there should be a little more steelmaking on the east coast, where it will be proximate not only to United Kingdom but to Western European markets. I am concerned that Shotton is 17 miles from Morpeth, on the coast, which makes it unattractive for bulk steelmaking. There will be redundancies of about 6,500. Port Talbot, on the coast, is to be extended. In Scotland, Ravenscraig is 43 miles from the nearest deep water port at Hunters-ton.

Mr. Lawson: Is the hon. Gentleman aware that the narrow belt of Scotland is only about 44 miles across, and that Motherwell, where Ravenscraig lies, is nearly one-third of the way towards the west coast?

Mr. Skeet: I have looked up the figures and I will pursue my argument. There will be an opportunity for the hon. Gentleman to make his own speech in due course.
While it is right to have as much of one's capacity on the coast as possible, it is extraordinary for a strategy to be laid down for coastal steel works while we have steelworks on inland sites being extended, such as Ravenscraig and Scunthorpe—Anchorage—which is 19 miles by rail from Immingham. These two works have been retained and have apparently

considerable prospects for expansion. Paragraph 49 of the White Paper states:
BSC calculations showed that hot-rolled coil for the Shotton mills would cost substantially more if produced in redeveloped iron and steel making plant at Shotton than if delivered from the expanded Port Talbot.
The BSC has looked into this and it may well be right, but what is intended should be spelt out more clearly.
There is thus already a mix in the United Kingdom, and of the five substantial sites for basic steel production some will be inland and some will be on the coast. I back the proposition that the eastern seaboard will serve Europe. According to the White Paper, discussions are going on with GKN about East Moors. Surely, when we have got rid of all the difficulties which have occurred in the Hirshfield Report, it will be up to GKN to go ahead with the development which will make it unnecessary for BSC to move ahead on its own plans. We need more information on that.
In Scotland, £400 million is to be invested. Scottish production of steel is to be advanced by 48·7 per cent. Scotland is to be allocated 13·3 per cent. of the total investment income, and that is a significant figure. The Scottish share of the United Kingdom steel will rise from 11 per cent. to 13·5 per cent., and employment at 26,000 will be reduced by 7,000 to 19,000.
The position of Hunterston is intriguing. We know that it can cope with carriers of 350,000 tons—big by any standards. We know that Korf-Stahl Ag is considering a plant in Hunterston. We know that Oil Refining Services International—Orci—will have a refinery, and have planning permission at Hunterston for a steel rolling plant. If Herr Willy Korf is thinking of setting up a mini-mill of 300,000 tonnes, if Oil Refining Services International is thinking of putting up a steel rolling plant, if BSC has in mind at Hallside an electric are plant of 1 million tonnes, and if BSC is still contemplating direct plant production of iron, what exactly will be the configuration in that area?

Mr. Eddie Griffiths (Sheffield, Bright-side): If the two foreign investors which the hon. Gentleman says are interested in Scotland go ahead with mini-plants, my belief is that it will put in severe jeopardy the proposed 1 million ingot


tonnes electric are plant proposed at Hall-side. Under those circumstances, I do not believe that the BSC would go along with that project.

Mr. Skeet: I understand the logic of the hon. Gentleman's argument. A number of schemes are coming forward now, some of which are inter-related, and it is for the Government to indicate what is likely to be the configuration of Hunterston. Hunterston has the depth, it has the industrial facilities and there is a high rate of unemployment in this quarter. That can be absorbed by further industrialisation, and the Government must bear that in mind.
What we do not want, is to leave Scotland with no steel making processes, but it is assured of adequate capacity because it has Ravenscraig, in any event, to serve the local market.
The whole idea of the 10-year plan is a package. If it is decided that Ravenscraig is to be vastly extended, the Teesside plan would never come to fruition or the Lackenby plan would be cut back. It is no good hon. Gentlemen on the Opposition benches saying that we are prepared to eliminate this one and keep all the old plants going. My great fear about the BSC is that it should become a Montecatini or a Pirelli of Italy. There is no immediate danger that it will have such a dominant position as to fall under Article 86 of the Treaty of Rome. It has to be built up and it has to be structurally sound. It has to have modern technology. All the plants which are to be closed down are open-hearth plants. It is no use suggesting that open-hearth furnaces can be utilised for another eight or ten years and compete with the Japanese and the West Germans.
One of the best illustrations is the Scunthorpe works—the Anchor project—which will be producing 350 tonnes per man per year. That will be competitive with some existing Japanese plants. Plants which are working open-hearth furnaces produce only 100 tonnes per man per year and will go out of business because the price of the steel they turn out will not be competitive in the United Kingdom or overseas markets. Therefore, the prescription put forward by the Labour Party would be a prescription for unemploy-

ment. It would not be a prescription for strengthening the BSC which I understand is the Government's object.
Many developments are scheduled for Hunterston but we do not know precisely what will happen there. I hope this will be clarified.
To come to England, I am concerned about the vast contracts which are going abroad for pipes for the North Sea. One difficulty is that there is a great demand in the Middle East, the Soviet Union and elsewhere, and we are not in a position to supply their requirements. This is the fault of the BSC planning. BSC perhaps foresaw the market but did nothing to meet it.
Is it the object on Teesside, which is fairly close to the North Sea developments, that an enormous plant should be built, or will the construction be at Corby? I fully support the plans going forward for Teesside and Lackenby which over phase 1 and phase 2 should bring production up to more than 12 million tonnes. I also fully support the Appleby-Frodingham plant at Scunthorpe where there will be a vast expansion to give England roughly 20 million tonnes over the years.
But surely the philosophy behind the English expansion must be right, too. England has been hit hard by steel redundancies and it is England that has been hit hard by some of the redundancies in coal mining. By putting capacity in the North, many of these workers can be absorbed. I stress that when we consider what Europe is doing and where it is establishing its plants, if we are to compete on a mileage and tonnage basis with Europe, it is essential to be on the right side of the United Kingdom to cut down the mileage and basically to produce cheap and economic steel.

6.51 p.m.

Mr. John Robertson: Strange as it may seem, I do not intend to follow the hon. Member for Bedford (Mr. Skeet) on the question of Hunterston and planning permission given there. If he has that information it is rather strange that the Secretary of State for Scotland has not told us about it, because it is the Secretary of State who will give planning permission, and in fact that has not yet been done.
I want, however, in the interest of brevity, to confine myself mainly to Scotland. This is not a problem principally for the steel industry, but it is a regional problem of the first magnitude. All the noises that this Government have been making over the last year about concern for the regions, particularly Scotland, are meaningless unless in Scotland there is a fully comprehensive, extensive and competitive steel industry. Steel is a raw material and is not an end in itself. We are a manufacturing country and we need a plentiful supply of cheap raw materials on which to work. On that the Scottish economy will depend.
We in Scotland are 200 or 300 miles from the main steel-using industries of the United Kingdom. This puts us at a great disadvantage in relation to the rest of the United Kingdom, particularly with reference to the Common Market. It is unfortunate that the argument about steel in Scotland has centred on the question of whether there should be development at Hunterston or inland. There could be either and, so long as there was development at either, it would not, in itself, be important. We have tended to lose sight of the main problem, which is the problem of the steel-using industries in Scotland.
After 1st April Scotland's interests will be best met by a steel industry producing a wide range of products to suit the needs of the steel-using industries in Scotland as well, of course, as having some share in exports, and with Glasgow designated as a basing point for an equally wide range of finished steel. Information available suggests that Glasgow will be the basing point for only a very limited range of products, strip mill products, plates, universal beams, columns and a limited range of channels and joists which do not include modern metric sizes. That being so, it seems clear that it will be only a matter of time before the secondary mills in Lanarkshire will close for lack of orders. It would also seem clear that the industries using products at a basing point 200 miles away from the steel production will have to think again about their location. The BSC basing point pattern should fill in the blanks in this White Paper, which in the section relating to

Scotland is more remarkable for what it does not say than for what is says.
If the Scottish consumer has to absorb the transport costs from English basing points for products which are at present being rolled in Scotland, we shall reach the height of stupidity. This either suggests some kind of cynicism about regionalism and social problems or it is an indication that the BSC is to close down further mills and finishing processes in Scotland. We have great reason for concern about the future of the special steels division and the foundries in Scotland. The products which the Glasgow basing point will have may give an indication of what the BSC sees as the future production pattern of the Scottish steel industry.
Whatever the case may be, whatever is said about it and whatever work we produce in Scotland, if the basing point pattern is as I have been told it is, then it will be infinitely more difficult to attract steel-using industries in Scotland in future than it has been in the past—and it has been difficult enough in the past. The problem in Scotland is one for the steel-using industries and not especially one for the steel-making industry.
The effect of the BSC strategy in Scotland will certainly be to undermine the existing steel-using industries in that country by eliminating mills which supply steel-using industries with their needs. The rod mill in Dalzell was working full out, but was transferred to the North-East coast in the name of rationalisation. It will mean that if we want rods for construction work we shall have to send to England for them. The future for those engaged in construction in Scotland is that they will have to buy steel from the English basing points, and that will make it more difficult and more costly.
We must be apprehensive about the intentions of the BSC in relation to Hall-side. It seems obvious that if we are to produce 1 million tonnes of special steel we should know how it is to be used. Is it to be used in the foundries, is it to be rolled out, or is it to be shipped raw somewhere else? What products which will come from Hallside will be used by customers in Scotland? The whole policy is menacing to Scotland. I see the rationalisation programme carried out by the BSC as a disaster for Scotland. By


its nature the BSC must think on United Kingdom lines. That being so, it is quite logical, particularly in the context of the Common Market, to find Scotland outside the orbit of the corporation's thinking. Scotland and Scotsmen must find their own solutions and fight for them.
Rationalisation that has already taken place has had a devastating effect on Scottish steel making and has put the Scottish economy into great danger. Unless we in Scotland fight for a widely diversified steel industry, this danger will continue. I am not concerned about the massive mill at Hunterston, but there should be a plentiful supply of cheap Scottish steel for the Scottish steel-using industries.

Mr. Lawson: I hope that my hon. Friend will underline the fact that Scotland is one of the best points from which to export steel and steel products to Canada, the United States and across the Atlantic.

Mr. Robertson: I take my hon. Friend's point. We in Scotland have always exported steel. I hope he will agree that if we have to depend on steel manufactured in England, then Scotland will be out as a manufacturing nation and our economy will be finished. We cannot depend on the thinking of the BSC or on a Tory Government for the future of Scotland. We must insist that a proper range of products be made in Scotland for Scottish users.

7.0 p.m.

Mr. James Tinn: I have been concerned in this debate to hear so many hon. Members urging caution and asking the Government to take a second look at the proposed strategy. I cannot imagine what has happened so basically in the technology or the social situation to produce this result in a House which, until the White Paper was published and the recent statement made, had been pressing the Government for a decision about British Steel Corporation's strategy.
The main complaint by the Opposition—and there have been complaints from Government back benchers—has been about delay. The principal charge I would make against the Government and their steel policy is that the necessary decisions have already been delayed for

too long. I thought that there was a good deal of common ground on this point, and therefore I was surprised, as well as concerned, to find so many hon. Members urging caution.
Some hon. Members adopted this approach backed by attractive arguments. For example, the hon. Member for New Forest (Mr. Patrick McNair-Wilson) worked from the well-known standpoint involving the highly cyclical nature of demand for steel—meaning, one supposes, that there is likely to be a substantial proportion of capacity unemployed or underemployed at certain times. The hon. Gentleman urged flexibility and cautioned the House against an over-dependence on a monolithic and rigid approach to output and the economic costs of large modern plants.
The hon. Member for Canterbury (Mr. Crouch) also took up this point. He said that because of developments in the pumping of iron-ore in slurry form the cost-saving factors on coastal sites were not as great as had been assumed. These facts have been well known to the corporation for a very long time. They are at least as well able to come to a decision on that basis as is the House of Commons—which, until recent months, has rarely found time for more than a half-day debate on the future of this great industry.
One cannot help suspecting that Members concerned about the implications of the strategy for their own area are anxious that the Government should examine this subject from a different angle. That is an understandable reaction, but it is no way to plan the future of an industry. It might be argued that I am guilty of the opposite of sour grapes because it so happens that my constituency of Cleveland will benefit from the proposal to site the large complex at Redcar. But, as the White Paper points out, the Northern Region has borne the brunt of redundancy hitherto and has suffered a third of the BSC redundancies. We have heard little about this because there are rather fewer Northern Members than there are Welsh and Scottish Members. However, it must be emphasised that in the last five years the Northern Region has lost 10,000 job opportunities against 7,500 in Scotland and Wales put together. I am not seeking to enter a competition in misery on the lines of who has suffered the most, but


I am trying to make an honest attempt at putting events in the Northern Region in proper perspective so as to justify in social terms the decision to site the complex at Redcar, a decision which on technological grounds was soundly based.
I do not know whether the Minister can give the comparative costs of alternative sites, but my information is that the savings at Redcar were very substantial. We cannot go on for very much longer considering trends of future production, methods and patterns. Surely the time has now come for decision. I believe that, on balance, the strategy is right.
I am by no means complacent about the impact on the areas concerned of the closures which have been announced. How can I be complacent? I am an ex-steel worker, a member of a steelworkers' union, my home town is Consett and my constituency Tees-side. I see the impact of redundancies in human terms and I am by no means complacent about what is happening. Therefore, I hope that full consideration will be given to phasing the closure of plants, such as those at Hartlepool, to try so far as possible to fit them into any new developments. Will the Minister comment on certain measures that can be taken to ameliorate the hardship that might otherwise be inflicted on redundant steelworkers?
A Press report in a local newspaper in my constituency refers to the negotiations between the British Government and the European Commission in Brussels involving the European Coal and Steel Community. The report suggests that this agreement will give redundant steel-men the best terms ever offered to workers displaced by industrial change. They will be paid 90 per cent. of their previous average weekly wage during periods of re-training and re-settlement and, according to the report, the British Government are pressing the Commission, which will meet half the cost, to allow these payments to be made for up to two years. I hope that we shall be told a little more about these negotiations which are referred to only briefly in the White Paper.
Later in the Press report there is a reference to the surprise caused in Brussels at the fact that these moves for a better deal for steelworkers have not

been supported by the Department of Trade and Industry in submitting projects designed to create alternative jobs in closure areas to prevent confidence draining from the regions. If the report is correct, the Commission obviously is a little ahead of the Government. Therefore, I hope the Department will speedily catch up and will produce some of the projects which are so eagerly awaited by the Commission.
Finally, I should like to say a few general words about the future of the industry. I have never been a Jeremiah about the future of the steel industry. Many of the international comparison figures made on productivity grounds are highly selective ignoring such factors as capital costs in the countries where labour costs are low.
I was interested by, and somewhat amused even, to read recently in the December issue of German International of 1972 an article on steel which shows that very many of the fears and concerns we have so often heard about our own steel industry are shared by the German steel industry, and with a good deal of reason. The article pointed out that the output rise experienced by the German steel industry last year cannot hide the fact that it was an appalling year for the profits of the industry. It showed that in the first nine months of 1972 there was a decline of 7 per cent. in German steel consumption. By rationalisation the labour force was cut by 4·6 per cent.—36,000 people—in the first six months of 1972. The competition likely to follow from the British steel industry on our entry into the Common Market was viewed with great concern.
The hon. and learned Member for Montgomery (Mr. Hooson) I observe has left the Chamber and the Liberal benches are in their normally deserted state. This is a pity, because I wish to pick up one of the criticisms he was making of British steel. Apart from the fact that it is publicly-owned, which is of course anathema to the Liberals, the hon. and learned Member thought its very great size inevitably meant that the decisions were not only wrong but catastrophic. Yet it is precisely the size of the British steel industry which gives it such an advantage over the German steel industry which, by the process of amalgamation it is attempting to carry


out only belatedly, can compete with us in the creation of large coastal-based sites on which the future of the steel industry must, not entirely but very substantially, depend.

7.12 p.m.

Sir Anthony Meyer: The hon. Member for Cleveland (Mr. Tinn), as a beneficiary of the strategy, gave a much warmer and more generous reception to that strategy than did the right hon. Member for Aberavon (Mr. John Morris), who sought to pick holes in it.
By and large, apart from the efforts of the hon. Member for Chesterfield (Mr. Varley), in what I thought was an unworthy speech spreading gloom and despondency among the ranks of steelworkers, there has been an astonishing measure of agreement on both sides of the House in the debate so far—a general, if reserved, welcome for the strategy coupled with doubts about the wisdom of putting all our steel eggs in five baskets, and a repeated demand for rather more specific information than is available to us in the White Paper.
The strategy appears to be based on four assumptions. The first assumption is that only very large units, by which I mean up to or above 5 million tonnes, are viable as steel-making units in the new climate of world competition. Secondly, such major units must be sited very close to deep water in order to secure the economies which flow from the transport of ore in very large carriers. The third assumption is that the BOS is the most effective process and has completely superseded the open hearth processes and adaptations of open hearth processes. The fourth assumption is that these three factors, taken together, mean that steel produced in these conditions is so much cheaper that it far outweighs the additional costs involved in transporting the semi-finished product in the form of hot-rolled coil to the process-finishing plants whence it is sent to the users.
I propose to deal briefly with all four of these factors, and take first the concentration of the production of steel in five centres. It is incontestable that this will bring economies of production, but, as many hon. Members on both sides of the House have pointed out, with those economies of production will go not only a loss of flexibility but an increase of

vulnerability. A dispute at any one of these five major steel-producing centres could completely cut the supplies of steel to the finishing plants which are dependent on them. Moreover, a delay in the construction of one of these five major sites or a snag in the commissioning of one of these sites could have the same crippling effect on those who are dependent for their supplies on these major producers.
We also bear in mind that the five major steel-producing plants, which will inevitably have to assemble large labour forces possibly drawn from outside the ranks of traditional steelworkers, must reasonably expect to have difficulties about shaking down and possibly certain labour troubles at the outset. Any one of these factors could gravely upset the calculations which led to the decision to concentrate steel production at these five works in the first place.

Mr. Tinn: I am not certain whether I heard the hon. Gentleman correctly. Was he assuming that the Redcar site on Teesside would draw its workers from those inexperienced in steel? If so, I can assure him he is entirely wrong. Even after the first stage of development takes place there will still be unemployed skilled steelworkers on Teesside.

Sir A. Meyer: I am ready to accept the assurance of the hon. Gentleman that in the case of Redcar all the additional workers drawn in will be men already living in, and part of, the steel industry. But this will not necessarily be the case with all five of the major steel producers.
I do not want to place too much weight on this factor. I suggest merely that it could alter the basis of calculations. I am not suggesting that because of these factors the strategy should be revised, but that, because of the existence of these factors, it is wise to build a safety margin into the strategy which to my mind is conspicuously lacking.

Mr. Skeet: This is not a question of an atomic power plant, where the technology is new and, as a result, there are difficulties. As these plants are conventional and built all over the world, serious problems are not likely to arise.

Sir A. Meyer: I hope my hon. Friend is right.
Of the possible snags I have pointed out, by far the most telling is the likelihood of delays in construction. Almost every major construction project embarked on in recent years in this country has attracted the attention of trouble-makers brought in from outside. I am not talking about steelworkers; I am referring to a vast expansion in the construction industry, which is much more susceptible to the kind of strikes my hon. Friend has in mind.
The second factor is proximity to deep water. It is obvious to anybody that this confers enormous cost advantages, but "enormous" is a loose word. The figure of an economy of £8 per tonne was quoted for steel produced as a result of proximity to water, as opposed to steel produced when the steelmaking plant is far away from deep water. Here again certain developments, although they will not entirely invalidate the conclusion, will alter the equation slightly. My hon. Friend the Member for Canterbury (Mr. Crouch) has already referred to the pumping ashore of iron ore in the form of slurry in a process known, I am told, as the Marconaflow process, which could radically alter the relative cost advantages of having the steelworks situated by deep water. It is, I believe, unlikely that remove those advantages can be entirely removed, but this could considerably alter the figure of £8 per tonne.
Taking the example of Port Talbot, according to the British Steel Corporation it will cost about £2 or £2-minus per tonne to convey hot rolled coil from Port Talbot to Shotton. But again, according to the corporation's calculations, it will be £8 per tonne cheaper to produce the steel at Port Talbot than it would nave been to produce it at Shotton.
Those seem to be the kind of figures against which one cannot argue. They may stand up to the factors about which I have been talking. They may resist any assaults from the relative cheapness of pumping ashore iron ore in the form of slurry. They may stand up to arguments about the possible delays and difficulties of commissioning new plant. All the same, I believe that we need rather more information on this than is available in the White Paper to enable us to form our judgment.
There is also the factor which does not, as far as I am aware, appear in the very

rudimentary calculations in the White Paper, that in the particular case of Shotton—obviously I am more concerned with Shotton than with any other plant—it is very much nearer to the end users or a large number of them than is Port Talbot. Therefore, it seems that this item also ought to enter into the equation, because if we have the problem of transporting hot rolled coil from Port Talbot to Shot-ton, we also have the problem of transporting the finished coated steel from Shotton to the very large number of end users in the area surrounding Shotton. That, too, ought to be a factor which enters into the equation.
Thirdly, I turn to the question of the equipment used for steelmaking. There is no doubt that in the present state of technology the BOS process is the most efficient. It has rendered open hearth steelmaking obsolete. But though it is of proved efficiency the BOS process is by no means new, and its supremacy may not last for ever. That point has been made by a number of hon. Members on both sides of the House. What is certain is that the BOS process requires colossal capital expenditure.
What also appears to be the case is that some of these new methods reduce the amount of capital expenditure required in that they enable use to be made of existing open hearth installations, not merely the buildings but also the furnaces. There is, for example, a project being discussed whereby for, in these terms, the trifling sum of £7 million the existing open hearth furnaces at Shotton could be linked in tandem so as to expand steel production at Shotton sufficiently to provide the steel which is necessary at present to keep the finishing lines at Shotton busy.
I do not for one moment suggest that this process is one that could last indefinitely or that it could possibly compete in cheapness with the BOS process. The point I want to get across is that if by this relatively modest expenditure it is possible to keep the Shotton option open, bearing in mind the very large capital expenditure which is required to install really up-to-date equipment and bearing in mind the enormous cost of capital in present circumstances, it becomes very difficult to rule out altogether the expenditure on what one might call running


repairs, the £7 million, in order to enable Shotton steel-making to continue in existence.

Mr. Eddie Griffiths: In all fairness, if the hon. Member is advocating that solution for Shotton he must also advocate it for Ebbw Vale, East Moors, Irlam, and any other open hearth furnaces. Therefore, he has completely negatived the idea of an expansion of the steel industry. He is settling for something that is second best.

Sir A. Meyer: The hon. Gentleman must always be listened to with great respect because he speaks with deep knowledge and complete honesty on the subject. I am making a special case, but it is a special case which has two sides. First, it is possible at Shotton or anywhere else to continue steel-making by the kind of running repairs about which I have been talking. But that in itself would not justify me in putting forward my argument. My argument would go on to say that Shotton is well placed to continue as a 2 million to 2½ million tonne producer with expenditure on the newer kind of steel technology, which I believe would be justified at Shotton bearing in mind its proximity to the end user of the scheme and the balance of costs in the social question which arise from balancing the costs of keeping Shotton going against the cost of producing new jobs in the same area.
On that basis there is a very strong argument, because to allow Shotton to go out of the steel-producing business will mean about 6,500 redundancies in the area. To provide alternative employment would cost, on the cheapest figure being bandied around, about £10,000 per new job. I have not yet heard a much lower estimate than that; though these estimates can vary enormously. In the oil refinery business I think it is about £1 million per job. But £10,000 is generally accepted as about the lowest figure of capital expenditure on which one can be fairly sure of providing a new job.
On that basis it will require about £65 million of capital investment in the Shotton area to produce jobs for those who are made redundant. For £65 million, in the present state of knowledge, it will be possible to provide a

real modernisation of Shotton's open hearth equipment—not running repairs—by one of the newer processes, such as SIP or QBOP processes, which are now coming up for consideration.
It is on this balance between the way in which steel making at Shotton can be prolonged for a shortish period by expenditure of about £7 million and then continued into the indefinite future by the adoption of the very latest steel-making techniques, and because this is justified on the grounds of Shotton being well placed for expansion with plenty of land on which to build, being close to the users and having available at Morpeth, near Birkenhead, facilities for the piping ashore of iron ore in the form of slurry, that this adds up to a very powerful argument in favour of keeping open the Shotton option.
Be that as it may, I hope that my hon. Friend will very carefully consider these arguments and balance them against the case put forward by British Steel. I hope he will decide that there is a powerful case for changing the decision about steelmaking at Shotton.
One thing seems absolutely incontestable. This was a point made in particular by the hon. Member for The Hartlepools (Mr. Leadbitter). It is simply not practical to think in terms of providing new jobs in these steel-making communities within the kind of time scale which seems to be envisaged in the White Paper.
Paragraph 49 of the White Paper talks about beginning the closure of steelmaking capacity at Shotton in the second half of this decade. That is grim enough, but from remarks let slip by senior officials of the BSC it has become evident that the second half of the decade means some day after 31st March 1974. I find this very alarming, as, I believe, does the Secretary of State for Wales.
With this fate hanging over our heads, I feel so intensely unhappy and worried about the future of the jobs of the men whose whole livelihood revolves around that great works that I must ask by hon. Friend whether he can give me an unequivocal assurance that the Corporation will not be prompted to begin the rundown of steel making at Shotton in 1974 or 1975—I hope, for very much longer. Unless I get a firm assurance that a rundown at any time during 1974 or 1975 is


ruled right out of court, I am very sorry, but I will not be able to support the Government in the Lobby tonight.

7.32 p.m.

Mr. Donald Coleman: The hon. Member for Flint, West (Sir A. Meyer) accused my hon. Friend the Member for Chesterfield (Mr. Varley) of spreading gloom and despondency. Having listened to him, I must say that the hon. Member himself has not done very much to help the feelings of gloom amongst the steel workers at Shotton. This is a matter for him to deal with with his own constituents, many of whom work in this works. My purpose is not to take up a parochial point of view but rather to place on record the views and feelings of the organisation which is most concerned with the steel workers in this country.
The views of the Government on the steel industry fortunately show that there has been a turning away from the previously held rigid position, which they deployed in the early flush of victory during the summer and autumn of 1970, and which favoured the killing off of lame ducks.
That is to be welcomed, but it does not relieve us of the responsibility of expressing in this debate the anxieties about the future that have been expressed to us. When one contemplates the Government's handling of the nation's industrial affairs, one frequently unearths situations of anguish. The present problems of the gas industry, the hospital workers, and the Civil Service are but examples of the Government's mishandling of industrial situations that have caused ordinary decent law-abiding working people to adopt the actions of those who are thrust down by despair. We have not yet reached that situation in the steel industry, but we are sufficiently advanced along that road for the anxieties to have become visible.
On 18th April, in London, the Iron and Steel Trades Confederation has convened a national conference so that it may discuss the serious concern in which the Confederation holds the proposals for the steel industry. Such a conference has never been held before in the history of this Confederation.
The White Paper, awaited with almost bated breath after two and a half years

of frantic study by the Government on what it expects of the British Steel Industry, advanced us no further than the Secretary of State's statement to the House before the Christmas Recess. This is an indication of the insensitivity of the Government and Ministers to the feelings that motivate those engaged in the steel industry. When will the Government realise that the workers of this nation are people who respond best when they know what they are being called upon to respond to?
The White Paper tells us the good news and the bad news but it gives us very little information about what the good news really means. No one who is familiar with the steel industry will deny that large sections of the industry need bringing up to date. The open-hearth furnace method of large-scale steel making, for instance, cannot for much longer compete with the basic oxygen converter, and, like the old puddling furnaces of the last century, will soon in its turn become obsolete. Technological change and economic pressure have forced a geographical shift in the places where steel is being made to the proximity of deep water ports through which large tonnages of rich ore can be shipped at minimum transport costs.
This the British steel worker knows for himself. He is a realist about his industry. He has never feared facing up to new methods of production. If he had, the post-war revolution in the tinplate industry of South Wales would not have been achieved with the harmony which ensured its success. The British steel worker is aware of the economic arguments which encompass his industry and of the alarming effects of the invasion of the world's steel markets by Japan, using the most modern steel-making methods.
He has also recognised the opportunities of increasing their steel exports to Britain that are afforded to other EEC countries, following Britain's accession to the Community. He knows only too well that the economic case for a modern steel industry in Britain is indisputable.
The Iron and Steel Trades Confederation, whose members will bear the brunt of the redundancies foreshadowed in the White Paper, have always advocated modernisation of the British steel industry, which cannot be said of the former private owners. Had they been as convinced


of this as the workers have been, some of the difficulties that steel workers will have to face over the rest of this decade would have been avoided.
Writing about this recognition by the workers of the need for a modern steel industry, Sir David Davies, the General Secretary of the Confederation, quoted from a policy document published in 1931, which entirely summed up the attitude of the steel worker towards his industry, and which is as true now as it was then:
We recognise that, in the process of adjusting an unorganised industry, displacement of labour must occur, but this would be taken into account and, as far as possible, provided for in the conscious planning of the industry.
The document also warned against
…the disregard of social obligations in respect of the effect upon local communities by the closing of works without any preconsidered arrangements as to the disposal of the labour displaced".
It is 42 years since that declaration by the Iron and Steel Trades Confederation in 1931, times which were more disadvantageous for the workers than today, but they spell out the attitude of the Confederation towards the modernisation of the British steel industry currently being expressed. It is an attitude which says "Yes" to modernisation, but which also demands that the industry lives up to its social responsibilities. This means that, as the nation is now the owner of the major proportion of Britain's steel industry, the Government must assume the social responsibilities for it.
The Confederation makes it abundantly clear to the Government that, while its policy is to co-operate in the modernisation of the steel industry, its co-operation is dependent upon the recognition, in tangible terms, that the Government have a responsibility towards the workers displaced from the industry and the communities from whence they come.
The Confederation will not tolerate steel workers being made redundant while there is no alternative employment available for them. The Government need to show more recognition of this resolve on the part of my union than they have in the White Paper. I suggest that Ministers individually should show a recognition of this resolve, too.
Recently during Welsh Questions the Secretary of State for Wales showed himself to be niggled at the fact that I put to him my concern about how the workers will fare who will be displaced at Ebbw Vale, Cardiff and Shotton. I spoke then, as I have today, as a member of the union which will find its members bearing the brunt of this modernisation. I demand, as does my union, to know more of what is in the Government's mind to help these workers and their communities. The White Paper does not advance our knowledge or confidence very much. Because of this, I emphasise again that it is the Government's responsibility to give a firm guarantee that alternative employment will be available before the closure of any steel plant is permitted.
The steel workers of this country are amongst the most responsible people in our land. When they recognise the need for modernisation and that it can be carried through only with their cooperation, they have the right to demand protection for themselves and their communities.

7.43 p.m.

Mr. Eddie Griffiths (Sheffield, Bright-side): In recent weeks I have been reading with a great deal of interest about alternative proposals in some of the works that will be in jeopardy in the next 10 years. I have read about various techniques of improving productivity in those works by adapting open hearth furnaces. Indeed, the hon. Member for Flint, West (Sir A. Meyer) illustrated some of these techniques.
It is right to remind ourselves that we are dealing not with 14 separate companies, each looking after a given works and trying to improve the profitability, the efficiency and the competitiveness of the material produced in those works, but with a nationalised corporation which has many options open to it. It is not part of its remit to insist that steel making should continue at plant A, B, C, or D. Indeed, it is asked by all Governments to run its production efficiently and profitably and to compete both at home and internationally. Therefore, when we talk about £3,000 million over the next 10 years, it is incumbent upon the BSC to invest that money to produce the cheapest possible steel, to get the most for its


money, and to get a return on the capital invested.
As I said in an intervention during the speech by the hon. Member for Flint, West a particular plant does not have the sole right to be modified. What is good for Peter should be good for Paul. We cannot salvage one works, improve its efficiency slightly, and say that it is all right for 15 years. We must go right through and modify all the plants.
The White Paper covers four broad points. The first is the need for a steel industry in the 1980s. I suspect that many people think in terms of the steel industry of the present or of the immediate past. The White Paper is concerned about the industry in the 1980s and beyond. We should be talking about that, not about the past.
The second point concerns the size of the industry, the third the type of industry that we shall have, and the fourth, certainly not least in importance, the social problems which this change will bring about.
The need for a steel industry in the 1980s is beyond doubt. It is not even a debating point between the Government and the Opposition, so we can dismiss that.
On the size of the industry I have a major quarrel with the BSC plan endorsed by the Government in the White Paper. I still believe that they are being too conservative. I should have liked 5 million to 7 million ingot tonnes of modern steelmaking capacity to be laid down for the 1980s. I accept that if my idea had come to fruition it would have meant, as the Secretary of State said, an acceleration of the closing of obsolete plants—plants based on open-hearth practices, and badly located plants.
I believe that we have dilly-dallied too much with the steel industry. It has been messed about and become a football for the politicians. The industry does not have a good competitive stance. There have been years of neglect and time is not on our side.
Looking at the escalating imports of both finished and semi-finished steel products and considering the price advantage that we now enjoy in international steel

prices, I believe that we could reduce imports to a great extent and produce the steel ourselves. I am sure that we could make a substantial breakthrough in the export markets. Coupled with the price advantage, which I think we shall still have even after the increases of 1973, I believe that we can go out and sell our steel competitively. We are approaching boom conditions in the industry. We are already hearing of lengthening delivery dates. It is tragic that an industry, which is the pillar of the British economy, should have to tell its customers: "We are sorry. You cannot have your steel in six weeks. It is more likely to be six months." Our whole economy can suffer as a result.
Enough has been said about the type of industry that we shall have. The emphasis is on coastal sites—BOS plants. I believe that this will be a competitive method of making steel certainly until the late 1980s and possibly into the 1990s. Some hon. Members have mentioned various new technologies. There is no need to rule out these techniques and technologies. For example, if in the post-1975 period direct reduction comes into vogue, what is to stop the Government or the BSC from saying, "We shall put down 3 million ingot tonnes capacity of direct reduction techniques"? If another method is developed, there is no reason why it and other innovations should not be superimposed on the plan we are discussing.
Not very much has been said about special steels, the manufacture of which is carried out mainly in the Sheffield-Rotherham area, though it is also carried out throughout the country. Some capital investment is to go to that sector.
I endorse some of the points made by the hon. Member for New Forest (Mr. Patrick McNair-Wilson) about the private sector. The time is ripe for the Government to instigate a study of that sector and report on its problems and how it can be helped by Governments in the future.
Some of my hon. Friends may say, "We don't recognise a private sector", but I am a realist. Whether I like it or not, the private sector produces about 3½ million ingot tonnes a year. The bulk of the private sector is in Sheffield, and if it disappeared our unemployment would increase dramatically from 3·8 per cent.


possibly well into the range of 6–7 per cent. We must consider sympathetically the needs of the private sector, which contributes substantially to the industry.
I turn now to the social problems resulting from change. I agree with the strategy in the BSC's proposals and endorse 100 per cent. the selection of the expansion points. I am delighted about Redcar, and I believe that the plans for Port Talbot, the extension of "Anchor" and Llanwern, which is now going through, and the development at Ravenscraig are right. With the best will in the world, modernisation means that the obsolete go out.
The social problems fall into two categories—the problem of the present steelworker and the problem of the job loss in a given area, which I believe is the bigger problem. For example, if there are to be 6,000 redundancies in Ebbw Vale, unless jobs are replaced there will be a loss of that number of jobs for all time, however well the redundant steelworkers are treated.
One of the deplorable things about the British steel industry is that there are still people of over 65 working in it. That is condoned by the unions representing them in many cases. The matter should be examined immediately. When a steelworker who has sweated his inside out for some 50 years has to continue after the age of 65, it is a tragedy and a condemnation of the industry. There should be immediate discussions between the BSC and the unions to bring about a scaled retirement, starting in 1975 and finishing in 1980, so that workers aged 60 and over can leave the industry with dignity and a decent pension.
The question of manning should be considered, and the Minister should also say something about redundancy payments. I can visualise a steelworker working alongside a docker unloading iron ore, with the docker receiving £4,000 redundancy pay and the steelworker, made redundant for the same reason, receiving £600, £700 or £800. What is sauce for the goose is sauce for the gander. Severance pay should be examined in detail.
Many people are cynical about the task forces. We are concerned about the 50,000 jobs that will be lost in the next 10 years. It may have escaped most hon.

Members' attention that between January 1966 and November 1972, 71,000 steel jobs disappeared, a rate of 12,000 a year. Now we face a problem of 5,000 a year. I sympathise with those concerned about their own interests, and understand their anxiety. But the sooner we on the Opposition side in particular feel for all redundant workers, whether post office workers, coal miners, British Rail employees, or steelworkers, the better. The tragedy is that if we come from a steel constituency we are concerned with steelworkers. Pits have been closed throughout the country, and the steelworker has not given the matter a thought. The railways have contracted, and the steelworker has not given that a thought. Now it is the turn of the steelworker. The lesson is that we should look intelligently and sympathetically at all job contractions.
I do not take a cynical view of the task forces. Their innovation may prove successful, and I sincerely hope that it will. I ask the Minister to make available to Members all the figures made available to works councils and local authorities, so that we may examine these matters objectively.
As my hon. Friend the Member for Neath (Mr. Coleman) said, the British steelworker has never said that the steel industry owes him a job throughout his life. But the industry and the steelworker do say that he is entitled to work. I come from the same union as my hon. Friend and can confirm the position of the Iron and Steel Trades Confederation, that, unless there is evidence that alternative jobs are coming to the areas hardest hit, including those affected in the past six years since nationalisation, the unions concerned will feel resentment. The Government's biggest task after the White Paper is to show the steelworker evidence that jobs are coming to the places hardest hit.

7.58 p.m.

Mr. Peter Rost: It is a great pleasure to follow the hon. Member for Sheffield, Brightside (Mr. Eddie Griffiths), because I agree with so much of what he says, and because he talks more sense than the whole of his Front Bench put together.
The modernisation of the steel industry is long overdue. The Financial Times


put the matter rather well on 22nd December, when, commenting on the preparation of the White Paper, it said:
The British steel industry has slipped back in the past few years, partly because of the prolonged uncertainty over its ownership, its organisational structure and its overall development plans…. The main requirement is simply that the BSC should behave commercially. The new investment programme should at last provide the equipment that the Corporation needs to do its job effectively.
But the history of the British Steel Corporation since nationalisation does not inspire me with a great deal of confidence that the performance can match the hopes in the White Paper, which says:
The Corporation estimates that more than half the expenditure can be met from depreciation provisions and retained profits;".
I hope that I do not appear to be too cynical if I suggest that there has not been much evidence of profits so far.
The truth is that nationalisation has propped up obsolescence and has subsidised inefficiency and held back productivity. Moreover, it has isolated the industry from competition and stifled growth and modernisation. The nationalisation of the industry and the management which has accompanied it has converted profits into losses and deprived the industry of cash flow that it desperately needs to modernise. Meanwhile, although the productivity of the industry has been rising, it has been rising only at about half the rate of our overseas competitors. I blame the management almost entirely for these inadequacies.
The competition which the BSC has comes primarily from private enterprise steel in Germany, the United States and Japan. Because our industry has been in a political dogfight for more than 20 years the investment which has been desperately required was withheld prior to the industry's nationalisation by the Labour Government who, following nationalisation, neglected it even further. The Sunday Telegraph summed it up rather well in an editorial on 24th December. It said:
The fear of public ownership had made private steel producers shy away from putting new money into their businesses and investment in modern plant was sadly neglected as a result.
That was before nationalisation. We know that since it has been starved even further.
This House should be realistic and admit that nationalisation as a form of ownership and control of this industry has been a catastrophic failure. It has failed to meet the demands of the market and the customers, it has been a disaster for the taxpayer, and it has been a drag on the economy. What is more, the inefficiency which has been generated through nationalisation and the uncommercial and unenterprising attitudes of the industry's bureaucratic management has deprived the industry of profits and cash flow and therefore of investment—

Mr. Lawson: Reading.

Mr. Rost: If the hon. Member for Motherwell (Mr. Lawson) wishes to intervene I shall be happy to give way to him.

Mr. Lawson: We do not want a speech read out. Let us have a contribution that the hon. Member for Derbyshire, South-East (Mr. Rost) thinks about while he is on his feet.

Mr. Rost: In my view the industry should have generated far more of its own capital investment for expansion over these years than it has, and there is nothing in the White Paper which inspires me with confidence that the situation is likely to change in the future.

Mr. Lawson: Still reading.

Mr. Rost: Moreover the Corporation have failed as a monopoly—

Mr. Lawson: On a point of order, Mr. Deputy Speaker. Is it in order for an hon. Member on the back benches, as distinct from a Government spokesman who is opening a debate, to read every word of his speech?

Mr. Deputy Speaker (Sir Robert Grant-Ferris): Of course it is not the custom of the House for an hon. Member to read his speech. The practice is always deprecated by the Chair and by all lion. Members. But it is the custom to allow Members to refresh their memories from copious notes.

Mr. Rost: I am sorry that the hon. Member for Motherwell does not regard my contribution to the debate as a serious one. Beyond saying that, I can do little to please him.
As a monopoly the corporation has failed to meet even the captive British


market. The large-scale underwater pipes required for North Sea gas have to be imported from Japan, and only the American steel industry appears capable of producing the high-quality steel which may be required for our future nuclear power industry. Now we even find that a proportion of high-quality sheet steel is to be imported from the Continent.
That leads me to ask whether the present management can be trusted with an investment of £3,000 million. Can we see any reference in the White Paper to whether the Government are satisfied on this point? The White Paper does not even seem to ask whether the corporation will make the right decisions in the future.
In Derbyshire my steel constituents refer to the bureaucratic hierarchy in the head office of the BSC as the "ex-United Steel Mafia". That may be a slight exaggeration, but there is no doubt that what is going on in the management seems to be the subject of a fair amount of covering up.
A number of hon. Members opposite have referred to the McKinsey Report. If the industry is accountable to the public, we require some clue about whether the McKinsey Report's recommendations are being or will be implemented. We need to be satisfied on this point.
If I may be allowed to quote for the third and final time, the Economist summed it up on 23rd December when it said:
If the Government is going to throw money around like this in the nationalised industries, the least the country have a right to expect is that the industries are run as efficiently as possible. When is the shake-up coming at the British Steel Corporation?
That brings me to my conclusion, which is that since nationalisation the industry has not inspired me with a great deal of confidence that the vast Government financing operation which is proposed in the White Paper is capable of being handled properly by the present management without suitable supervision from outside. I believe that such vast Government financing can be acceptable to the public only if there is some reassurance that an improved financial discipline will be imposed. In my view that can come only through the discipline of a competitively orientated management in a competitive situation, with account-

ability to shareholders and to an outside capital market. In my view, therefore, it can come only through the introduction of private capital.
I believe that the industry should never have been nationalised. It should now be partially returned to private enterprise. With that proviso, I believe that the White Paper is the most exciting development that the industry has had for more than three decades.

8.8 p.m.

Mr. John Smith: It is unfortunate that more people who have an interest in the future of the steel industry were not able to hear the ridiculous speech which has just been made by the hon. Member for Derbyshire, South-East (Mr. Rost). It is depressing that Government supporters should be invited to give knock-about turns to keep their side of the House represented in the debate when there is a tremendous pressure by Opposition Members who are deeply interested in the future of the industry and are competing for a share of the brief time available. Sadly, that is a situation that we are used to in debates affecting regional policy in relation to some of our basic industries.
I have no intention of taking up the futile and barren attack of the hon. Member for Derbyshire, South-East upon the concept of nationalisation. It is sufficient to say that on page 8 the White Paper passes a comment about the steel industry as it was under private ownership. It says:
Nationalisation brought to the BSC a large number of works with obsolete technology and low productivity.
That is a sufficient epitaph for the way in which the steel industry was run when in private hands.
This debate is about a much more important topic than that sterile dispute; it is about the whole future of a great industry and of many areas which are dependent upon that industry for employment and future growth. The Opposition have been wise to criticise the lack of information which is apparent throughout the White Paper. It makes it extremely difficult for people trying to grapple with the implications for their areas to make much sense from what is proposed.
In his typical salesman approach the Secretary of State for Trade and Industry,


introducing the debate, did not take the opportunity to fill out the gaps and deal with the doubts and uncertainties in the White Paper. He stressed the size of the investment to be made and tried to play down the loss of jobs—fiddling about with regional statistics, telling us how many jobs had been attracted to Scotland from 1960–69, without telling us the number of jobs that had been lost. We have to deal with net figures, instead of playing round in a juvenile way like that.
Before we get too lyrical about the size of the investment, let us remember that it is spread over 10 years and that the White Paper says, at paragraph 37, that the Corporation would have had to invest up to £200 million a year simply to maintain the existing asset structure. We would be committed to £200 million just to keep running on the spot. When we bear this in mind we can see that this is not such a bountiful venture as the Government sometimes make out. It is not necessarily an over-ambitious investment programme. We are now talking in terms different from the 43 million tones of which we once spoke. I do not think that that was a figure plucked from the air. It was based on planning by the corporation not so long ago.
It is clear from a study of the White Paper that the Government have rejected what they called the bold, high investment course, in favour of a policy which has a large element of minimising risks. The importance of looking at the White Paper is to see what it spells out for areas which are dependent upon steel for their livelihood. The White Paper refers to this in paragraph 33. Recognition is given to the need for concern about the effect on regional economies. It particularly mentions Scotland, as well it might, because of the important steel-using industries such as shipbuilding, engineering, and North Sea oil developments.
The White Paper blandly concludes that since a wide range of products will continue to be produced in Scotland there is not much cause for concern. I beg leave to differ. This White Paper sees the end of the Hunterston dream, the whole concept of which has stirred the imagination of West and Central Scotland. It was felt that in the deep-water facilities provided there, there would be a real power-house of regional

regeneration, that we would be able to see through that, not only an expansion of the steel industry, but of the whole of our industrial life in West and Central Scotland.
All of that would have been given a great boost, up to a new level of activity and promise for the future. This White Paper dashes that dream completely and for ever. I beg the Government not to rule out the possibility of any future developments at Hunterston. They must be flexible in their thinking so as not to condemn Hunterston to sterility. I hope that the options will be kept open.
There is a certain irony in the fact that as soon as the Government made clear that the corporation was not going ahead at Hunterston, a number of competing developments have sprung up, including a proposition for a foreign mill. There is considerable confusion at present about what is intended for the area. I very much regret that we have missed a great opportunity there. Scotland will take a long time to recover from the loss of morale which has been brought about by the dashing of its hopes, which at one time senior representatives of the Government in Scotland encouraged.
The Under-Secretary of State for Trade and Industry (Mr. Peter Emery): Will the hon. Gentleman tell the House whether he believes that the Government should impose on the BSC management a "Hunterston solution" which would be contrary to the corporation's view about the best possible management of Scottish steel?

Mr. Smith: I would want to see a much bigger programme for British steel. I believe that, if left to its own devices, the corporation would be operating a much bigger programme. If it were able to operate the 43 million tonne programme there would be a real future for a green field site somewhere in the United Kingdom. There would be a fight about its location but Hunterston would be a strong contender. Now it seems that possibility is to be denied to us. I ask the Government to regard the current Scottish figure as a floor and not a ceiling. The Government and the corporation should keep their options open to enable them to increase the range of activities of the Scottish steel industry.
It is important that we retain the capacity to produce a wide range of steel products in Scotland so that we can service the wide range of steel-using industries there. Steel forms the sinews and raw material of industrial development. It is important that we have a wide range of products for Scottish industry. I ask that consideration be given to the introduction of a tinplate galvanising plant in Scotland to extend the range of products.
There is great difficulty in determining what the White Paper means. I do not know why the section on Scotland is phrased in the way it is, but it creates more mysteries than it solves. We are told that some new high-grade specialist products will be introduced. We do not know what they are. We are told that in some cases primary rolling will cease at many mills, but we are not told which ones. We are not told when the closures will take place, which areas will suffer redundancies, or the time scale for these events. It would have been better if the Government had given much more information.
It is not even clear where the promised £400 million is to be spent. The Government have attempted to clear this up, yet the confusion is as great as ever. We can pin down about £200 million, but that still leaves another £200 million to be accounted for. I gather from my hon. Friends from Wales that they are in the same difficulty. If we have a real plan for the future we need to know its details, so that we can assess its effects in our areas. This plan does not give us that detail, and the Opposition are right to table the critical amendment, which I hope the House will approve.

8.18 p.m.

Mr. Eric Cockeram: While I heard the earlier speeches in the debate, I apologise for the fact that my other parliamentary duties have caused me to miss some of the more recent speeches. Like all other hon. Members I am pleased that the Government have shown their confidence—

Mr. Roy Hughes: On a point of order, Mr. Deputy Speaker. I have great respect for your judgment in these matters but is it not rather nauseating that the hon. Member for Bebington (Mr. Cookerham), who has just come into the

debate, should be called when some of us have been sitting here for five hours waiting for a chance to speak?

Mr. Deputy Speaker (Sir Robert Grant-Ferris): Order. The hon. Gentleman knows that these matters are for the Chair to decide. I am most anxious to get everyone who wants to speak into the debate. The less time we waste the better.

Mr. Cockeram: I am pleased that the Government have shown their confidence in the future of British steel by suporting this massive investment. It is essential for the steel industry to remain competitive, particularly if it is to increase its output and to sell the increased quantities envisaged in this White Paper. Some of the steel will have to be sold abroad, hence the need for the corporation to be effective.
Investment on this scale will involve substantial productivity increases. This seems to pose two problems. The first is that the increased ouput will clearly have to be sold because production is not an end in itself. Consumption is the end and production is but the means to that end. It is no good steel companies or anybody else producing a product which cannot be sold. Secondly, it will involve a reduction of manpower in the steel industry. Similarly, therefore, this problem has to be solved.
I believe that, fortunately, the solution to both these problems is on the same lines—namely, acceptance of the fact that as a country becomes more sophisticated in its production techniques so a smaller percentage of the employed population is engaged in production and an increased percentage of the employed population is engaged in distribution. This can be seen in advanced countries around the world.
Hence, I support the Government in their tactics in taking measures at this stage, in advance of the implementation of the proposals for the steel industry, to stimulate demand in this country. I think the Government were completely right, for example, not to seek to continue the process whereby one aspect of employment, distribution, was singled out for penalty in taxation and another aspect of employment, production, was singled out as somehow wholly desirable. I refer, of course, to SET. I am very


pleased that we are moving over to a tax which does not appear to discriminate in this way.
Similarly, I am pleased that the Government have taken measures to remove the penalties of hire-purchase control which existed previously, because this likewise stimulates consumption. We have already seen the benefit of the ending of these restrictions, which is to the advantage of the steel industry, make no bones about it. In the motor car industry, the washing machine industry, and others, output is up, and that is to the benefit of the steel industry, because it is no good the steel industry producing if it cannot sell its product—and it can sell only to consumers. That is why it is important that the Government get that aspect of their policy right in advance of this substantial investment.
For that reason I support this programme, bearing in mind the fact that it is inevitable that such an investment, involving modern methods of production, will mean that fewer persons are engaged in that production. It must, therefore, be associated with stimulating demand by consumers, which the Government are doing. That is why I think the Government have their priorities and their timing right.

Mr. Deputy Speaker: We have about 40 minutes left, and I think I can get in all the speakers who passionately want to be called. I hope that, as I call them, they will look at the time and divide the 40 minutes up between them.

8.24 p.m.

Mr. Roy Hughes: Certainly this White Paper which we are debating has told us little that we did not know before. Paragraph 37 points out that £200 million annually is needed to maintain the existing asset structure of the corporation and that an average of £300 million annually is now needed to expand at the level proposed in the document. Presumably this is where the figure of £3,000 million for the decade comes from.
Out of this £3,000 million, of course, £900 million could be, as the White Paper puts it, for Wales. That figure is shrouded in mystery. Certainly the answer was not forthcoming in the debate on the industry which we had on 25th January in this House, and it was

certainly not forthcoming from the Secretary of State in his opening address this afternoon.
I have pursued this matter of investment in Wales with the Minister by letter, and on 15th February I received a letter from him which I can only say, with great respect, added confusion to confusion. I and some of my colleagues have been speculating about how this £900 million is to be allocated. We have thought in terms of £400 million for Port Talbot, which would bring production there to 6 million tonnes annually. It would also, according to the document, provide 1,000 jobs at Port Talbot. It is remarkable, though, that as late as 1971 over 2,000 jobs were lost at Port Talbot owing to open-hearth closures.
The questions I want to ask this evening are the following. First, what is the gross investment at Port Talbot, including the replacement of outdated equipment? Secondly, what proportion relates to new investment? How much is earmarked to build new plant and how much is to replace or maintain existing plant? For example, I understand that Port Talbot has an ageing hot-strip mill. It was apparently built in 1953 to a prewar design and it will need replacement or considerable modernisation. This could cost as much as £200 million. Here there is no new expansion, but presumably this figure is included in the overall figure of £900 million for Wales. Thus if the bulk of the £900 million is merely to bring Port Talbot up to date, I say that £900 million is quite inadequate even to bring our major plants up to the level of technology at which they should be now.
Then the plot deepens, as one might say, because the Minister's letter pointed out to me that this development at Port Talbot was not expected to cost anything like the amount I had envisaged.
I am also told that there will be continuing expenditure on schemes already under way, of which the major one, the Minister pointed out, was to expand the steelmaking capacity at the Spencer works, Newport. The major factor here is the provision of a third blast furnace. I was not told by the Minister that this was first announced on 21st January 1970 —that is over three years ago. It cannot be believed that our competitors work in such a vague and retrospective manner.


The Spencer, according to the plan, is to be one of the two integrated works in Wales that will be left out of the proposed closures. It is well sited, inasmuch as it is now connected to the two principal motorway networks. Nevertheless, according to Lord Melchett's definition, it is still a three-legged animal, because it has no iron-ore terminal, and certainly the workpeople there cannot be satisfied until they get one. If we are to emulate Japanese methods, this iron-ore terminal is vitally necessary.
Certainly these matters of investment call for full public explanation, and the workpeople concerned should certainly know what is happening about their future. We need to know all about the 2,500 jobs which, according to Lord Melchett, are to be lost in Wales. Can we be given straight answers when the Minister replies and not evasion which we have had hitherto?
There is no joy in the proposals for either Ebbw Vale or East Moors. I hope that that aspect of the proposals will not be implemented. However, the corporation has said that it wants to help these areas. It has set up task forces. One of the practical ways in which it can help these areas will be to develop the Spencer works. Both of the works are within commuter distance of Newport with its iron ore terminal and the other developments which are now needed at the Spencer works.
I am disturbed at the rumours that the principal trade union involved in the steel industry has accepted the proposal put forward by the Government and the BSC. The General Secretary of that union has been silent on these matters. Sir David Davies, as he is so affectionately known in the steel journals, should now be leading a fight against the closures. My hon. Friend the Member for Neath (Mr. Coleman) pointed out that the union was having a national conference to discuss these matters. National conferences in the Iron and Steel Trades Confederation are a new venture. I noticed in my local newspaper, the South Wales Argus, on 1st January this year the headline
Knighthood for ex-mill boy
and I am sure this is a well-deserved honour for Sir David. But if these proposals go through there will be a lot of

other ex-mill boys in Ebbw Vale and they will not be given knighthoods—they will probably end up in a dole queue.
It is becoming apparent in Wales that we shall have to unite to fight these closures. We have a right to demand that before such closures take place new work is provided and communities are not left derelict.

8.32 p.m.

Mr. George Lawson: We have waited a long time for the White Paper. It is getting on for three years since we were told that this deep-rooted analysis and study of the steel industry was to be carried out. I would have thought we would have had an exciting document after all this time. I am amused that the term "exciting" has been used so many times. The Secretary of State was almost unable to contain himself in the use of the word, and the hon. Member for Derbyshire, South-East (Mr. Rost) referred to the "exciting prospects" for the industry contained in the document.
With the short time at my disposal I shall confine myself to the situation in Lanarkshire and ether parts of Scotland away from Hunterston, because most steelmaking industry is in Lanarkshire, apart from the works at Glengarnock, Ayrshire. I have to a considerable degree supported the steps to be taken to ensure that we have a sensible industry in Scotland, but if we examine what is proposed in the document we find that it is certainly not "exciting".
Paragraph 44 says that investment in modern plant will raise BSC capacity in Scotland from the present 3,700,000 tonnes to 4,500,000 tonnes by the early 1980s. To raise steelmaking capacity in Scotland from 3,700,000 tonnes to 4,500,000 tonnes in 10 years is to step up capacity by only 2 per cent. per annum. If the Minister is saying that there is something exciting about an expansion of Scotland's steelmaking capacity by 2 per cent. per annum over a period of 10 years, I have a rather different idea about what "exciting" means. If he says it is better than was achieved before, I refer him to the White Paper where in paragraph 4, it says that during the period when the steel industry, both in private and public ownership, was being so badly treated the average growth


of industry was 1·7 per cent. That is not very different from what it was between 1955 and 1970. The average growth then was 1·7 per cent., so that 2 per cent. is not so very different or so exciting in terms of the prospects that confront us in Scotland.
I put it to the hon. Gentleman, and through him to the Secretary of State, that he ought to withdraw the word "exciting". This is a very modest and very cautious plan. Lord Melchett talks about his flexibility. The very root of this flexibility is the caution with which the whole thing is envisaged. We talk of £3,000 million being spent, but that is a projection into the future. It is thought that approximately £300 million a year will continue to be spent, but nobody can give us any figures. It is very much a guess in the dark. It is hoped that this kind of expansion can go on, but it can be more than that. These are some of the specified things to be done.
It is fair to say that at Ravenscraig it is intended to step up production to 3·2 million tons. It is fair enough to say that that will cost a certain amount. It is fair to speak of a development at Clydesdale and say that development of the ore terminal at Hunterston is to cost £36 million—a very necessary thing. I trust that it is not all a question of hope. We are told that it is intended to develop a 1 million ton capacity electric are plant at Hallside to give us steel—because we must have steel and if we were to get anything less than 4½ million tons in this period it would be a deplorable development. I tell the Under-Secretary of State that the very minimum that we may look for is 4½ million tons, and I would hope we can get substantially more.

Mr. Emery: The whole House has the highest regard for the hon. Member for Motherwell (Mr. Lawson) with his many years of service, but will he understand that I and the Government accept his desire for flexibility? The flexibility in the plan provides for greater expansion, if we can do it, as well as for the scheme overall.

Mr. Lawson: I am crediting the hon. Gentleman and the Government with trying to do these things. I want to see them done, and I will back them if they are genuinely trying to do them. But I am underlining the point that we want

these things done at the very least. In terms of the works we have, which the hon. Gentleman may not have properly appreciated, there is a great deal of talk about Ravenscraig, but there is also the Dalzcll works, with 2,800 people. We do not know what is happening there. There is the Lanarkshire works, with about 1,600 workers. We do not know what is happening there. No one knows what is to happen at the Craigneuk works, with a further 1,400 to 1,600 people. There is certain talk about finishing processes, but we cannot employ all these workers on the basis of finishing processes.
It is about time the British Steel Corporation was able to tell us what it intends to do about works of that kind. It is about time we had more information. We have had no information at all. Certainly, after all these years of studying the matter, it is time we knew what was happening to those works and what is to happen to the Craigneuk special steel section. We do not know. At the present time this is a very important jobbing mill. It is doing a very good job, and those in the area think that it ought to continue.
Similarly, we do not know what will happen with the steel foundry in the area. These are the matters about which we must have information.
The Government must be a little more humble about the plan—it is very modest and cautious—and cut out words like "exciting". I have not found anything exciting about it. I should like to he excited, but on this basis I cannot be. We want more information.

8.40 p.m.

Mr. John Mendelson: The Secretary of State for Trade and Industry ought to be present to hear more of the debate, because it is no substitute to have the constant interruptions of the Under-Secretary, the hon. Member for Honiton (Mr. Emery), who just takes more time from those who represent the steelworkers and others in the industry—

Mr. Emery: Thank you very much.

Mr. Mendelson: The Secretary of State showed that he was interested more in propaganda than in making the case for Cabinet policy. It is the absence of a case so far that ought to be remedied


later in the debate by the Minister for Industry.
There is therefore not much to discuss in what the right lion. Gentleman said at the introduction of what is a very important event, because this is the major occasion for the House of Commons to pass judgment on a plan that has been worked out, we are told, by the British Steel Corporation and approved by the Government. It is also important because of the right hon. Gentleman's attempt to pretend that he is the only man in the country and in the House who is in favour of the expansion of the industry—with, perhaps, the notable exception of my hon. Friend the Member for Sheffield, Brightside (Mr. Eddie Griffiths) whom he also allowed to enter into the very rarified atmosphere of that small circle.

Mr. Eddie Griffiths: When you are in, you are in.

Mr. Mendelson: That is not quite the position. The people who work in the industry and earn their living in it have always declared, and certainly made it clear in discussions with the former Labour Government, that they wanted a complete modernisation of the industry and would give such modernisation their full support. This is therefore no new attitude developed suddenly by some of my Front Bench colleagues, as the Secretary of State tried to allege. But those in the industry added, when they discussed these matters with that Labour Government, that there must be a common understanding that modernisation would mean not a decline in jobs because of a declining industry but a decline in the number of jobs because it is a highly modern industry. This is the decisive factor that must be understood.
That fact was appreciated at that time, and there was a compact between the Labour Government of that day and the steelworkers' representatives that full support would be given to modernisation but that at the same time we had to see to it that more jobs were created in the industry as the new plants came into existence. I heavily emphasise that the first part of the contract was more jobs in the industry. There was a compact that if as a result of the vast technological

changes that would then come about, which were foreseen then and which we are seeing today, redundancies should occur, new job opportunities must be brought into the steel areas before the process of modernisation was completed. That is the important point.
I speak for members of the Stocks-bridge Joint Committee of steelworkers and I use almost their very words to bring the facts to the knowledge of the House. They say constantly at their meetings that it is not good enough to speak of a general commitment to provide alternative jobs. That is not specific enough. It is no good the Government trying to ride off with such a general assurance. We need something which ties the Government much more to a policy of provision of new job opportunities that can be regarded by the people in the industry as a commitment and not just a general promise.
If we want to keep the younger element within the industry, those who will develop high specialisation and get into positions of importance and responsibility, it is important that they should know that there will be opportunities in the industry for them. Therefore, it is no good the Government saying that they have done their duty by issuing a general statement about task forces. My hon. Friends and I have good reason for pressing the Government to go beyond that.
It is not a question of diplomatic secrecy and saying that commercial secrets might be involved. It is not beyond the wit of man so to provide information that that particular part of it remains isolated. Such information is provided to large corporations in other industries. I could give chapter and verse of some Government Departments which are not tight-lipped with their friends who represent big corporations, and the information is spread round the gin and tonic tables, as my right hon. Friend the Leader of the Opposition said on an earlier occasion. The Government should be listening to the debate and should reply positively before the vote is taken.
I wish to refer to the whole approach of the chairman of BSC. The Secretary of State has said constantly this afternoon that all he is doing is putting forward the corporation's proposals. One would almost think that the Government


had nothing to do with the White Paper, that it had been written by somebody else and was nothing to do with the Cabinet. That is a lot of nonsense. The real story is quite different.
In the spring of 1970 the chairman of BSC submitted a 10-year plan to the Government. The plan, step by step and year by year, outlined development to a higher figure of expansion than is proposed in the White Paper, and the cost was given for each year. But, as Lord Melchett told some of us a year later, delay could be very dangerous for the corporation's prospects because of galloping inflation. Any project may cost twice as much if 18 months are allowed to pass. It is all very well to talk about £3,000 million, but I am not happy with that figure. Had we started in March 1970, we might have achieved similar or better results at a lower level of investment. We should have got better value for money in those days. The figure that the Government are parading is an inflated one, and they are entirely to blame for the delay.
I hope that one day there will be appointed a Select Committee to consider the steel industry and the Government's conduct towards BSC. The Government have never agreed to such a Select Committee. A Select Committee would tell us about the influence of the American company that the Government appointed. There was the Joint Steering Group, there was no time to be wasted and everything should have been done quickly. But the Government did not leave well alone. They called in yet another group of consultants and there was delay, month after month.
Once we have put the record straight it will be seen that the Secretary of State has lost all reason for thinking that he is doing the work of the Lord for the industry. The projects should be developed as quickly as possible and there should be a clear understanding that where there are skilled resources an opportunity will be found to keep most of the men at work in medium-sized works as well as large works.
I turn to one local point referring to my constituency. There is a reference in the White Paper concerning special steels to Stocksbridge and Tinsley Park. There is a stroke between the names of those two, but that is all that is said

about them. The Government must provide clear and definite information as to what they have in mind. I recognise, as do all hon. Members representing steel constituencies, that the Government have a duty, just as the men in the trade union have, to say categorically that we want to take a national view of the industry. While we must represent the interests of our constituents—more directly even than the unions can do—we must also take the overall view.
Therefore, anyone finding himself in a position similar to that of my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot) the other day would be equally duty bound to represent those interests, as he did in the detailed case he made. At the same time we, of course, take the national view. We want a modernised and big British steel industry able to compete with other steel-producing countries.
I see that the Minister of State has just returned to the Chamber. I make no complaint about his having been absent for a time. He had to prepare the reply to the debate. I do complain, however, about the Secretary of State not being present. He should have been here all the time. It is important to the future prospects of the modernised industry that an interest should be shown in the local communities; it is therefore the duty of the Minister to see that guarantees and assurances are given by the Government that wherever in the process of modernisation redundancies occur, the maximum number of new steel jobs will be provided as soon as possible. I go further and say that the timing of the modernisation process should be dependent on and closely allied to the provision of new jobs and that public money should be spent in keeping steelworks operating longer than might otherwise be the case so as to provide employment until new plant is ready. We have not had that commitment from the Government.
In an area where a certain part of steelmaking work will come to an end, there will perhaps be the production of some new end product. We hope that will be the case in a number of instances. That will be useful, but it will not provide the number of jobs which are lost. There must be a firm Government commitment that alternative employment will


be brought to such an area before the steel works are closed.
I say this to the Secretary of State who made an attack this afternoon. As a member of the Parliamentary Opposition, I see nothing contradictory between what my hon. Friend the Member for Ebbw Vale said on behalf of the Opposition in the speech quoted by the Secretary of State and the attitude which we from the steel areas have always adopted. My hon. Friend tied it to a specific policy commitment. That commitment still stands. It is up to the Government to show that they feel equally seriously about the future prospects of workers in the steel areas

8.55 p.m.

Mr. Michael Roberts: The hon. Member for Penistone (Mr. John Mendelson) rightly pointed out that the modernisation of steel inevitably leads to the loss of many jobs. He rightly went on to say that we must ensure that the steelworkers made redundant are given job opportunities. But in the Cardiff area—where we face 4,000 redundancies, or 3,500 redundancies if the mini-mill is constructed—if the task force within two or three years were able to provide all the jobs, the loss of steelmaking to Cardiff would still be a great loss to our community and we would deeply regret it. Even if other well-paid jobs were provided in the city—and we should welcome them—we would want to look closely to see whether the corporation's calculations were justified.
At one stage we were led to believe that BSC thinking was along the lines of the maintenance of some of the smaller mills. We now know that its thinking has changed and that within the corporation a decision has been made on the lines of a larger steelworks. Until we see the figures and can analyse them we are not convinced that the present calculation is best suited to the needs of the steel industry and our community.
I wish to make specific reference to the East Moors steelworks. It is in the constituency of the right hon. Member for Cardiff, South-East (Mr. Callaghan), but constituents in Cardiff, North and Cardiff, West—and indeed in the whole area—work in that complex and may face redundancy. The special case put forward

by the works committee—and that case demands careful consideration—is that the customers for the East Moors works are not scattered throughout the United Kingdom and are not even overseas. They are to be found just over the wall, in GKN, within a stone's throw of the smelting and steelmaking process in Cardiff. Those who are knowledgeable about steelmaking in Cardiff do not believe that it would make economic sense to bring 750,000 tonnes of steel all the way by rail down to Cardiff and there to process it, when there are requirements for 100 specialist steels all of which could, and in their view should, be provided by the steelmaking process immediately adjacent to the GKN works.
I have not sufficient time to develop all that I would like to say about the East Moors situation. Some time ago I wrote to my right hon. Friend and asked what investigation the Government had made concerning the use of the submerged injection process and about the continuation of East Moors as a profitable steelmaking process. I hope that they are closely investigating this matter.
We were told by Lord Melchett when he visited us in Cardiff that 30 alternative schemes had been considerered before the corporation reached the conclusion that the East Moors works should be declared redundant and that a mini-works employing 500 people should be put up in its place. The people of Cardiff, and the steelworkers in particular, reject that thinking. They have not yet seen the details of the 30 alternatives mentioned by Lord Melchett. They ask and expect the Government seriously to consider their case.

9.0 p.m.

Mr. Barry Jones: I hope that tonight I can dismiss the undeserved lachrymose reputation that I have previously earned.
I rate the strategy as questionable. It certainly proposes the desolation of traditional steel towns and the wastage of loyal and skilled work forces in steel. It seems to show an obsession with things Japanese, but just how profitable is the steel industry in Japan?
America is restructuring her industry by installing cheaper, smaller, more flexible and more profitable methods of making steel. I hope the Government


have not accepted a strategy which could be heavy industry's equivalent of the Concorde fiasco.
Since my constituency is scheduled to lose 7,200 job opportunities, will the Minister, before the flood of public money starts flowing, order a public inquiry into the Shotton situation? Will he also enable the consultants of the Flintshire County Council to have access to the calculations of the corporation with reference to Shotton? Steelworkers in my constituency fear that the rundown will begin a year early, in the spring of next year. Will the Minister deny this by confirming that one of the blast furnaces will soon be relined, with a view to immediate re-use? Will the Minister also tell us the return on capital expenditure on the tandem furnace scheme submitted by the Shotton action committee to Lord Melchett?
The White Paper refers to the special study that was made of Shotton because of the grave social and economic consequences. I urge the Secretary of State to reverse his decision and keep Shotton open, as an insurance against the late commissioning or malfunctioning of any of the proposed large sites.

9.2 p.m.

Mr. Michael Foot: Like my hon. Friend the Member for Flint, East (Mr. Barry Jones), who has put the case for Shotton so effectively and passionately over so long a period, I wish to devote a considerable part of my remarks to the position of those areas which are threatened with steel closures. Inevitably we must do that because, as many of my hon. Friend from this side of the House have stated, and as I am sure the House appreciates, we have a deep obligation to the people who have sent us here when we are faced with problems of this magnitude.
I wish to make clear at the beginning that we on this side of the House who have to deal with the possibilities of closures and all the awkward consequences which would follow are also deeply concerned about the future of the steel industry as a whole. But because we are concerned with our individual problems, it is not at all the case that we are not also eager to see the steel industry expanded on the best possible basis.

That is why we say in our amendment that we welcome the conversion of the Government to the commitment to an expanded steel industry.
The right hon. Gentleman the Secretary of State has not, like many of us, had the advantages of attending many steel debates over several years. The right hon. Gentleman is therefore not always quite aware of the situation. I can remember the previous debates we have had on this matter. If he had attended those debates, the right hon. Gentleman would have discovered that the demands for an expanded steel industry came almost entirely from hon. Members on this side of the House whereas almost the only people doubtful about the proposition were hon. Gentlemen on the other side of the House. It is no good anybody contesting this proposition. For about two or three years we had to deal with those whom, in those distant days, we described as the bowling alley boys, the two Ministers who were in the right hon. Gentleman's Department previously and who had enunciated a doctrine that it was just as good to expand bowling alleys as steelworks if a higher profit could be gained from them.
Therefore, if the right hon. Gentleman had attended these debates or been able to do so he would not have got out of proportion and out of scale what is the position. Moreover, he would have discovered that the figure of 28 million tonnes as the target to be developed—we are all very glad to see that that figure is now discarded—was never produced by anyone on the Opposition side of the House. The figure was never suggested.
The Minister for Industry was the first to mention the figure of 28 million tonnes in the House, as far as I can recall. As the right hon. Gentleman knows perfectly well, that was the figure that the Government put to the Steel Corporation, and the Opposition contested that idea right along. Again, it is no good hon. Members on the Government side of the House thinking that we are concocting some fairy tale when we say that we are glad to see that the Government have been converted to the view of an expanded steel industry, which we have preached throughout. I hope that the right hon. Gentleman will understand that.
It is also no good for the right hon. Gentleman or anyone else coming to lecture those of us from the steel constituencies about the painful choice which may be involved in expansion. We are well aware of it. We have already been dealing with the situation. In Ebbw Vale, for example, over the past 10 years we have reduced the total in the steel works there by some 3,000, and the same applies to many other steel works up and down the country, for instance, in the North East, as my hon. Friend the Member for Cleveland (Mr. Tinn) indicated.
It is no good the right hon. Gentleman coming and preaching some sermon to us as though he were teaching us the elements of these matters, because we are aware of these matters. The difficulty for the right hon. Gentleman, is that in a sense he has entered the stage in the middle of the play and he has not taken too much effort to discover what went on beforehand. I dare say that even the eloquence of Mark Antony would be a bit diminished if he were not aware of the fact that Ceasar had been murdered. The right hon. Gentleman has taken up the drama on the assumption that he had merely suffered from inflammation of the bowels. Naturally, the right hon. Gentleman is not exactly aware of the situation. Now we shall try to put him right.
However, it is partly for this reason that we criticise the way in which the Government have presented the expansion programme. That does not mean that we are opposed to the best possible expansion programme that can be secured for the steel industry as a whole. What we complain about in the White Paper in this respect, however—this has come from my hon. Friends, whether they are fully sympathetic to the programme or whether they have qualifications—is that, whatever view one takes about the way in which the steel industry could be developed, there is no defence to this White Paper because it does not even make the good case which possibly the British Steel Corporation may have.
This White Paper, I insist, is not a White Paper presented by the corporation. It says on the front—which is the truest part of the whole document—
Presented to Parliament by the Secretary of State for Trade and Industry by Command of Her Majesty.

I am not sure about the "Command of Her Majesty" part, but the other part is the accurate part of the White Paper.
The right hon. Gentleman has presented a White Paper describing how £3,000 million is to be invested over this period and how we are to embark on what he himself has described on dozens of occasions, as my hon. Friend the Member for Motherwell (Mr. Lawson) said, as the most exciting and creative programme that has ever been put before the British steel industry. If that were so, in the White Paper there ought to have been a much better defence of the position, for example, particularly as the right hon. Gentleman has come upon the scene in latter days and particularly because he used the phrases from the Dispatch Box about the figure of 43 million tonnes "trickling off the tongue" of my hon. Friends. The figure of 43 million tonnes is again a figure which was thought up originally by the Corporation. If there were to be a lower figure in the strategy for the next 10 years than that which the Steel Corporation itself had presented to this same Government a year and a half ago, there should have been an explanation in the White Paper as to how it was that the Government had decided to abandon that target of 43 million tonnes with all these other implications.
Then there is the whole matter of the "missing" £300 million, as we call it in Wales—the figure to be provided for investment in Wales. Particularly because the Secretary of State has boasted so much about the £900 million, we are entitled to have in the White Paper a detailed account of how this money is to be allocated or how it has been calculated. Where does it come from? How was it estimated? There must be documents in the Department, as my right hon. Friend the Member for Aberavon (Mr. John Morris) pointed out so effectively, which show how this figure was reached. Why can we not have them in the White Paper, so that we can test them? Also, as my hon. Friends from Scotland have said, Scotland does not know how the £400 million is arrived at.
This is an astonishing state of affairs. The Secretary of State and the Government blow their own trumpets very loudly, saying, "We have a magnificent programme", and we must all accept


that as the last word. Yet when we ask for even the most elementary explanation of the figures, we are not given it. It certainly is not in the White Paper.
This is all the more important, because the strategy is not self-evident. It may be that the British Steel Corporation's strategy of concentrating upon the coastal sites, on the form of development and the basic oxygen process, is perfectly correct. Perhaps all that can be proved, but it is not self-evident. It should be argued out in the White Paper.
The hon. Member for Flint, West (Sir A. Meyer) was quite right. He and many others, like the hon. Member for New Forest (Mr. Patrick McNair-Wilson) and many of my hon. Friends, have pointed out that there are many arguments about how one changes to that kind of industry —if indeed one should do so at the pace and on the scale which is proposed. That is not an argument against an expanded steel industry. We can still have an expanded steel industry in Shotton and Ebbw Vale and some of the other places that have made a considerable contribution.
Moreover, if the argument is to be the other way around—a number of people in the industry know about this—that is to say, if we are to be told that Shotton, Ebbw Vale and East Moors are finished and are to be chopped and no more steel making is ever envisaged there, there will be many changes in many such steelworks on the Continent and in the United States. I calculate—we shall be putting this to the British Steel Corporation and it will have to supply the answers—that there are 15 or 16 such strip mills in Western Europe which are not in such a different situation from us. In the United States, 50 per cent. of their production is still from some form of open-hearth process.
I am not saying that they are not making changes—of course they are—but they are also taking into account what those of us who put the case for Shotton, Ebbw Vale, East Moors and the rest are asking should be taken into account—the capital costs involved and the investment already made in those industries.
What those of us who are threatened with closures are determined to see is these figures worked out in detail. They should have been in the White Paper, too. There is a case, because the right

hon. Gentleman told me today that the British Steel Corporation is sending to us in Ebbw Vale the details of how it worked out some of these figures. We do not know yet how far it will go, because we have put to it many matters and we are entitled to the most detailed replies. Many of the figures should have been in the White Paper. They would have been a concrete illustration and we would have been able to examine them in the open. That would have been the proper way to do it.
It is peculiar that the British Steel Corporation made the announcement about Ebbw Vale on 16th November. We asked the corporation to show us the figures, because we had arguments against them. The corporation told us that we would have to wait, and it did not produce the first lot of figures or the first meeting until the end of January. Only now, in the middle of February, has it produced its first set of figures—figures which one would think it would have had available before making the decision.
On this aspect of the matter the White Paper is totally inadequate as an indication whether the BSC has made the right decisions in its major strategy and whether the Government have been right to approve them in the form—as we understand it—that the BSC presented them to the Government. We shall need to have many more debates to discover whether they are jusified. All of us representing threatened areas are demanding —it was our first demand, when we first heard the decisions—that the corporation must produce the details and prove its case. We have experts—people who know about the steel industry and have given their working lives to it—who have knowledge of how these kind of operations are done. These figures will be examined in detail. We have a right, indeed an absolute duty to the people we represent, to do that.
I turn from that general aspect, which applies to the country as a whole, to the detailed question of Ebbw Vale. I shall not spend all my time on Ebbw Vale, but I must mention it in view of the statement made by the Secretary of State today. The right hon. Gentleman has repeated the same kind of statement that so many Ministers have made about the Ebbw Vale position, not taking into account what we have told them on


various occasions. I wish that Ministers would listen to what we have to say, because we know what we are talking about on this subject. These are matters of the gravest importance from our point of view. Whether we shall be able to carry through any change in Ebbw Vale of Shotten sensibly depends upon whether any form of trust remains in those communities in the people who are saying what is to be their future.
I will attempt, once and for all, to clear up the question of 1970 which is referred to in the White Paper. These proposals for Ebbw Vale are not solely about Ebbw Vale. Naturally enough, they take into account the rest of the steel industry.
When Lord Melchett came to Ebbw Vale, he said:
You can be assured that a great deal of thought has been given to the future of Ebbw Vale by my colleagues and the board of the Corporation. It has not been an isolated study of Ebbw Vale on its own, but of the strip mill division as a whole of which this is one of the important works.
That is what Lord Melchett said when he came to Ebbw Vale not a few weeks ago, but in 1970. After such a statement we were entitled to take literally what he said to us.
The right hon. Gentleman's White Paper purports to state what Lord Melchett said to us in 1970, namely,
However, following the Corporation's announcement in 1970 on the future of steelmaking, BSC announced in November 1972 its proposals to close iron and steelmaking in 1975 and 1976 and the hot strip mill later in the decade with, in all, the loss of about 4,500 jobs.
That is so much of a half truth as to be a downright lie. In 1970 Lord Melchett not only said that he was proposing to bring steelmaking in Ebbw Vale to an end; in the same statement he gave a pledge of the maintenance of 8,000 jobs. Even more important he said, "You will have a development for your hot mill costing about £8 million or £9 million and the introduction of the improvements in the hot mill will go forward at the same time as the phasing-out of the steelmaking." Therefore, the pledges made by Lord Melchett in 1970 should stand as strongly as his proposal that the steelmaking would be brought to an end.
I plead with the Government to try to understand the effect in Ebbw Vale and other places where we have been similarly treated, although we naturally concentrate on the pledges given to us. What do they think is the effect in Ebbw Vale when, after we put the case to the Minister and he came to Ebbw Vale to listen patiently to what we said, he produced a White Paper in which the same half truth or, as I prefer to call it, downright lie is still incorporated? Does he want to bring Ebbw Vale out on strike? That is the way to do it.

Mr. Skinner: Let us have a general strike.

Mr. Foot: The Minister acted in the very way calculated to cause bitterness and anger among people who were seeking to deal with the whole question in the most constructive manner.
The very least the Government and Lord Melchett should do is to return to the pledges and undertakings they gave in 1970. It is not merely a question of Lord Melchett personally. It has been said in some quarters that in 1970 he came to Ebbw Vale and said something that he had not quite expected to say. That is not so. At the moment when he made that statement in Ebbw Vale Dr. Finniston read out to me the same statement in the offices of the corporation. His personal honour is just as committed as Lord Melchett's. The Government have implicated themselves in the business by presenting to Parliament a White Paper that purports to describe the true position of Ebbw Vale, when it does nothing of the sort.
What must be done, not only about Ebbw Vale but about all the areas threatened with closures? First, we have the right to examine in detail the propositions. I have already discussed that. Elaborate efforts are being made at Shotton, Ebbw Vale, East Moors and elsewhere to see that our case is put in detail. We have a right to have that case examined and to have the necessary time devoted to it. It cannot be done in a week or two; it will take a few months to examine propositions of such far-reaching significance. Secondly, we demand that the pledges we were given in 1970 shall be fulfilled.
Our third demand was put to the right hon. Gentleman with all the force we could muster when he came to Ebbw Vale, but it applies to other places. The dates proposed for the closures of Ebbw Vale, Shotton and East Moors are intolerable and impossible. It is impossible for the Government to seek to bind us to them—that is, to have more than 1,000 new jobs created in Ebbw Vale by 1975 and another 1,500 or so in 1976.
In any case, the Government are as much implicated as the corporation—or more so. They cannot shed the responsibility and say, "It is no business of ours when the closures take place". If they do, they cannot guarantee that they can bring in the other jobs. The two processes must be dovetailed in—the process of closures, if they are to happen, and the process of bringing in the new jobs. The Government, not the corporation, are the people finally responsible.
I say that no one in Wales, Scotland, or anywhere else will take the Government's pledges seriously, whether or not they are backed by task forces. I say at once that I am not against the idea of a task force. I think that it will come back and report, as one of its first pieces of advice to the Government, that these dates are impossible. But if the Government say that they refuse to play any part in fixing these dates, that they are not too certain about the dates, and that they are solely a matter for the corporation, I say that no one in Wales, Scotland or anywhere else will take seriously their promise to bring in new jobs before the redundancies take place.
The Secretary of State mocked me when he said that I was ill-advised to give the undertaking that I did, on behalf of the Labour Party, that when a Labour Government came to office we would suspend the operation of these dates and halt the closures, pending a review of the position in the industry and in the light of the new jobs that had been made available. That does not mean that the dates might not be reimposed later. It means that the Labour Party undertakes the commitment that this Government ought to undertake, which is that the dates will be within the control of the Government.
Instead, the Secretary of State says, "We cannot do that," and, "Fancy anyone saying that we should intervene on the dates." The right hon. Gentleman says that the Labour Government never did. But that is what did happen. It happened in the coal industry. I can remember making a number of speeches from below the Gangway on the Government side of the House about the coal industry. I was critical of the Labour Government about the pace of the rundown of the coal industry. I think that even in that Government many people who supported the rundown at the pace then agreed now agree that it was an error.
I should have thought that both political parties would have learned from this. Even so, it is not the case that the Labour Government refused on all occasions to intervene on the detailed closures. In The Times of 30th September 1967 there was a report of a statement made at Scarborough by my right hon. Friend the Leader of the Opposition, then Prime Minister, about the way in which the Labour Government were intervening to hold up some of the closures. I remember quoting that report. As a result, Section 5 of the Coal Industry Act 1967 covered the whole situation. In fact, the Government intervened on some of these closures. It is no good the Secretary of State's trying to use that as a defence.
There is an even simpler argument which affects the whole situation. Here again, it may be that we must attribute the right hon. Gentleman's failure to understand the situation to the fact that he has not realised what has happened in the steel industry in the past 2½, years. His Government have interfered with the detailed running of the steel industry on a scale which has not been attempted with any nationalised industry in the history of nationalisation. We have had not only the Prime Minister's arbitrary interventions on the subject of steel prices—and we all remember those occasions; we have had the establishment of what we called at the time the "constitutional monstrosity" of a joint steering group whereby responsibility between the Steel Corporation, the Government and the Civil Service was blurred. It was a committee set up—

Mr. Peter Walker: indicated dissent.

Mr. Foot: The Secretary of State shakes his head. Everyone in the British Steel Corporation knows that that is the case. Of course the right hon. Gentleman is not familiar with these matters. But the fact is that the joint steering group established by the Government had surveillance over a whole range of detailed matters including individual investment programmes. Yet this Government, who have been responsible for such intervention as that over a period of two and a half years now say at the end of it, "Please do not ask us to permit the constitutional impropriety of ever daring to interfere with the dates for closures laid down by the BSC."
The right hon. Gentleman should understand the position. We can see from the experience of the coal industry, or at any rate from the experience we have had of the steel industry in the last year or two—from all the knowledge we now have—how difficult is the operation of changing over from one industry to another. It is difficult enough, in all conscience. Everyone knows the problems are enormous.
It may not be so difficult in some of the bigger cities. In communities like ours the whole livelihood of the area could be shattered. We have to sustain the morale of whole townships during this period. We have to sustain the morale of people working in the steelworks because the steel is still needed. If they cannot produce the steel in Ebbw Vale and Shotton over the next two or three years we will not be able to get the finished products. If we cannot produce the steel in those threatened towns which have been told that they will be shut up after two or three years the loss to the corporation will be reckoned in millions of pounds.
Why is it that the corporation says, now with the backing of the Government, that this has to take place in 1975 or 1976? It has nothing to do with the prosperity or profitability of Ebbw Vale or Shotton. It is due solely—we asked the Minister for an answer to this last time; I hope he will give it now—to the calculation of the corporation that it will have such a surplus of steel in 1975–76 that for its own profitability and its operations it must close us down as soon as it can.
Those matters, too, must be examined. We have a right to see whether what the corporation is saying is true. Our livelihood depends upon it. Our whole chance of preserving civilised communities—some of the best communities in the country—depends on our capacity to be able to carry out the changes, some of them inevitable, in a decent and civilised way. I am sure that when the right hon. Gentleman came to Ebbw Vale he saw a community which was determined to do this. We have a right—we do not come here to beg—to demand from the Government the assistance which great democratic communities ought to have from this House. This is what we said and this is what we stand on. If this Government will not give assistance to places like Shotton, Ebbw Vale and all the others that are threatened, the next Labour Government will.

9.33 p.m.

The Minister for Industry (Mr. Tom Boardman): It is always delightful to listen to the hon. Member for Ebbw Vale (Mr. Michael Foot) although it is not particularly enlightening on occasions such as this.

Mr. Robert Mellish: My hon. Friend is concerned about people getting the sack. If that is not enlightened, what is?

Mr. Boardman: The hon. Gentleman intervened earlier in the speech of my right hon. Friend and said that the next Labour Government would cancel all closures and begin a review of the whole system. He repeated that a few moments ago during his speech. He moved straight from that to condemn the review body, the Joint Steering Group that was set up to do the task which he presumably now thinks should be done by the committee he wishes to appoint. His inconsistencies are quite remarkable.
The hon. Gentleman spent some time condemning the Government for not requiring the corporation to intervene and cancel the closure of Ebbw Vale and other such places. He moved on to criticise the Government for "intervening in the affairs of the British Steel Corporation on a scale never before attempted." He must make up his mind which way he wants it—whether he


believes the Government should intervene or that the corporation should run its affairs.
The hon. Gentleman's speech was delightful to listen to, but was slanted, understandably, towards his constituency of Ebbw Vale. It omitted any reference to other areas which for the Front Bench would be of importance—Port Talbot, Teesside, Ravenscraig. Are they of no importance to the hon. Gentleman? Is Ebbw Vale all that he cares about?

Mr. Michael Foot: Mr. Michael Foot rose—

Mr. Boardman: I will not give way. There were speeches from hon. Members on both sides which, with varying degrees of reservation, gave broad support to the White Paper strategy.
There were three speeches of particular significance. I have already referred to the hon. Gentleman. There was also—I hope the hon. Gentleman will not be embarrassed at being referred to twice—the speech by the hon. Member for Sheffield, Brightside (Mr. Eddie Griffiths), who, as my right hon. Friend has said, has a great knowledge of the steel industry and talks more sense about it than many other Opposition Members. There was a very interesting speech, too, from my hon. Friend the Member for New Forest (Mr. Patrick McNair-Wilson), who speaks with great knowledge. He raised a number of points, some of which I hope to take up in a few moments. Then there was, of course, the opening speech by the hon. Member for Chesterfield (Mr. Varley). I do not imagine that any hon. Member who heard that speech would have thought that he was speaking on the largest investment programme that has ever been undertaken in this vital industry.
The hon. Member spoke as though, if he understood the White Paper—and I believe that he must have read it—he was doing his best to conceal his knowledge of it. He spent all his time in a nitpicking exercise, trying to find some conflict between what the Secretary of State said and what I said. [Interruption.] If the hon. Gentleman does not like it, he can leave the Chamber.

Mr. George Thomas: Mr. George Thomas (Cardiff, West) rose—

Mr. Speaker: Order. Up to now we have had a fairly orderly debate. Will hon. Members please calm down?

Mr. Boardman: To justify what is said, the hon. Member for Chesterfield spent some minutes trying to draw a distinction between what my right hon. Friend said—"what will be approximately £900 million"—and "could be as much as £900 million". That was the level of his contribution to the debate on this great investment programme. What a way to set about dealing with an issue of such enormous significance.
The hon. Member for Ebbw Vale, and, indeed, other hon. Members, begged the question as to what is the rôle of the Government in this strategy. Certainly it is not for me—nor do I think my right hon. Friend would assume the task—to take upon myself the rôle of Chairman of the British Steel Corporation and dictate its management policy. It would be even less suitable for this House to assume for itself the judgment of a board of directors of the corporation. This is, indeed, a criticism which is often somewhat unevenly aimed at us by the Opposition. Our job—and I make this quite clear—is to ensure that the strategy makes sense against the general economic background, taking full account of regional, social, balance of payments and other factors for which the Government have a special responsibility. That is what we have done.
Throughout the debate a number of points have been raised by hon. Members on both sides as to the degree of flexibility in the plan. I would draw the attention of hon. Members to the White Paper and particularly to paragraphs 11, 12, 13 and 14, which make the position clear. Paragraph 28 in particular refers to the emphasis placed on flexibility in the corporation's proposals, and the whole question of flexibility is a fundamental part of the strategy. The whole planning is on the basis not of a rigid plan but one that can be adjusted to the needs of the moment.
One hon. Member opposite said that to make a firm, rigid plan looking 10 years ahead is a nonsense. I agree, and this has been avoided. I draw the attention of hon. Members to the planning process that is undertaken, and has been undertaken by the corporation, and with which the Government have been closely


involved. First, it is the drawing up of the strategy, deciding, looking at the blueprint of the steel industry for the 10 years ahead, the broad outlines and the way one sees it developing, coastal sites as against inland sites, and so on.
There is then the corporate plan to be prepared by the corporation, to be submitted to and approved by the Government. That plan will show how, based on the strategy, the corporation is planning its future. That will be followed by the five-year investment programme, and it is at that stage that the outlines of the investment begin to firm up for the requirements of the five years ahead. Then follows the detailed appraisal of projects and investment approvals.
As an illustration of that, I have today given formal approval to the corporation for capital expenditure on fixed assets in the United Kingdom in 1973–74 up to a total of £305 million at March 1972 prices. This compares with the authorisation of £265 million at 1971 prices for the previous year and is in line with the rising trend of capital investment by the corporation shown in the Public Expenditure White Paper (Cmnd. 5178). In addition, my right hon. Friend has given provisional approval for capital expenditure up to £300 million in 1974–75, covering a proportion—90 per cent.—of the total programme. That is the size of the programme we have authorised. Therefore, we shall have the corporate plan coming forward, projects being appraised, investment approval being given firm for the year ahead, and 90 per cent. approval for the year beyond that.
Hon. Members have asked for an explanation of where the £400 million goes. I can say that it flows from this planning process. I shall return to that point in a moment. Compared with our figure of £305 million the average level of capital expenditure—still at 1972 prices—during the six years when Labour were in power was £130 million, and they wonder why the industry is in difficulties! Hon. Members have asked how the corporation will spend the £400 million in Scotland and the £900 million in Wales. To expect detailed answers on that point shows a complete misunderstanding of the problem.

Mr. John Robertson: Mr. John Robertson rose—

Mr. Boardman: Let me finish my argument. If the hon. Member then still wishes to intervene I will give way to him.
It is forecast in the White Paper that the average annual expenditure will be at the rate of £300 million a year in the next 10 years. It is explained how that will be divided roughly between the different areas. The expenditure which we can now go firm upon is in respect of those projects which are already under way, projects for which approval has been given and projects which have reached an advanced planning stage. In no investment appraisal and in no industrial arrangement for improving investment is it possible, 10 years ahead, to say precisely how the money will be divided between, say, project A and project B. The pattern of investment will flow from the strategy that has been adopted. That clearly indicates that the level of investment in Wales will be up to the level of £900 million, and £400 million in Scotland as stated in the White Paper.

Mr. Robertson: The point is that the £400 million is the Government's figure and not the figure of anybody on the Opposition side of the House. Surely it must be based on some facts, or is the Minister plucking the figure out of thin air? The people who know about the Scottish steel industry can count up to only £275 million on the projects forecast in the White Paper.

Mr. Boardman: It is not the Government's figure; it is the British Steel Corporation's figure. [Interruption.] If the hon. Member has not followed what I have been saying, perhaps when he reads it tomorrow he will understand it.

Mr. William Ross: Scottish MPs and the STUC have tried to get an explanation of these figures from the Secretary of State for Scotland. He said he would try to find them out from the hon. Gentleman's Department. Who will tell us how this £400 million is to be spent? Surely they had in mind certain projects that are to cost that amount. If they have not, then let them tell us that they just do not know themselves.

Mr. Boardman: The right hon. Gentleman must follow the ordinary basic


principles of investment decision-making. If I can translate it into the simplest possible terms, he will probably know approximately how much he will be spending on his household next year but he cannot say how much will go on sheets or shoes. I have tried to reduce it to elementary language to make it understandable. [Interruption.]

Mr. Speaker: Will hon. Members please calm down?

Mr. Boardman: The amendment refers to publication of reports of the task forces, but my hon. Friend has dealt with this and I do not propose to add anything further in the time available. The amendment also refers to the representations of the steel communities which are threatened with closures.
I remind the House—as I believe hon. Members who have been concerned with constituencies having these problems will know—that my right hon. Friend and I and other of my right hon. Friends have made ourselves available and have seen all the deputations and delegations concerned. We have consulted closely with all organisations and we have taken full account of views that have been put to us. All these have been taken into consideration.

Mr. Neil McBride: The hon. Gentleman says there have been the fullest consultations and all Ministers have been informed of developments. He will remember my leading a deputation representing 23 Welsh Labour councils to the Secretary of State and in his hearing the Secretary of State saying that he had not known about the proposals until two days beforehand. What a Government!

Sir Harmar Nicholls: On a point of order, Mr. Speaker. We have had to listen to Welsh interruptions and Scots interruptions. Cannot we hear an English voice?

Mr. Speaker: The choice of speakers is a matter for the Chair.

Mr. Boardman: A number of points were raised about Shotton. I apologise to my hon. Friend for referring to Wales again. The corporation has proposed that closures should be phased from 1975 to 1979 but has made it clear that this will be subject to discussion with the

unions and other interested parties. My hon. Friend the Member for Flint, West (Sir A. Meyer) asked specifically about the earliest date of closure. I can tell him, despite allegations that closure might be as early as 1974, that the corporation has assured me that this is not so, and that to comply with its obligation to give two years' notice of major closures the first closure at Shotton could not take place until after March 1975.
I do not wish to dwell at least on the detailed points raised by the hon. Member for Ebbw Vale because we have had numerous discussions on this matter, but I would inform him that I have a letter from the corporation which confirms that the facts are that in April 1970 the chairman told the Ebbw Vale work force that iron and steelmaking would come to an end probably between 1974 and 1976. Mr. Gray told them in 1971 that the date would be nearer the beginning than the end of that period. The date now proposed is 1975, which is fully consistent with what has been said to the work force officially, and is on record. It is a full five years after firm proposals were put forward. The hot mill closure was a new fact, first communicated informally to Mr. Hudson and Mr. Borton in October, and formally later, that the works would close in November. The closure date proposed is November 1978, more than five years' notice being given.
At the meeting on 16th November of the works council, neither Mr. Hudson nor Mr. Morton made any charge of bad faith or broken promises against Lord Melchett in respect of the October meeting. The hon. Gentleman should know that.

Mr. Foot: I know all these facts but the Minister does not face them. Why has the corporation any right to make a statement about what was to happen in 1970 and then to tell us two years later that it intended to abide by one clause and abandon two other clauses in the proposition, particularly when as a result of that agreement we accepted the closing of the coke ovens with a loss of some 300 jobs? All that was part of the agreement of 1970. Now we are told that the corporation can abandon some of the undertakings it gave—and very important undertakings, involving investment of £9 million or £10 million. The Minister now


says, "Oh, the hot mill was a new factor". The corporation has no right to abandon its undertaking. Why does not the hon. Gentleman try to seek some sense of honour in the matter?

Mr. Boardman: The hon. Gentleman knows that those facts are very strongly disputed by the corporation.
I realise that hon. Members are concerned about the future of the Brymbo works and the protracted nature of the discussions between GKN and the corporation about acquisition. I am in touch with the parties to see how we can assist in arriving at a successful outcome, but on the basis of recent assessment the corporation believes that it would be economic to continue operations at Brymbo for the expected life of the works if they are not acquired by GKN.
I am also in touch with GKN and the corporation about the future of steel making in Cardiff. We are most anxious to see a continuation of steel making there and the GKN plans going ahead, although the corporation had plans to go ahead if GKN decided not to establish its own steel making facilities.

Mr. George Thomas: Can the Minister say whether it is possible to delay the proposed date of closure? Lord Melchett told us quite clearly that they had it in mind that maybe a three-year scale would provide for the redundancies.

Mr. Boardman: That is a matter that probably should be raised with Lord Melchett. I cannot comment on it here.
A number of questions were raised on the private sector. I reaffirm what is said in the White Paper about the importance the Government attach to having a strong virile private sector supplied with die most competitive crude steel and able to make a better contribution to exports and to the general economy.
Questions were also asked about the report of Lord Hirshfield. The corporation has assured me that in moving to the ECSC pricing system it is their intention, so far as market conditions allow to give effect to Lord Hirshfield's recommendations on the margins between prices of billets and certain billet-derived products.
The hon. Member for The Hartlepools (Mr. Leadbitter) asked for confirmation of the value of the site investment and its

relative cost effectiveness against other products. I confirm that all the evaluations gave Teesside a substantial cost advantage over all other sites. The White Paper refers to it as having a cost advantage of some £20 million a year. As the hon. Gentleman pointed out—and perhaps, as has been said, the voice of England has been somewhat muted in this debate—it is an area which suffered most from the fall in steelmaking in recent years.
The siting of this plant on Teesside for once does what is both economically right and what would appear on those grounds also to be fair.
My hon. Friend the Member for Bedford (Mr. Skeet) spoke about planning permission having been granted for Hunterston. I understand that no planning permissions have yet been granted. They are still under consideration by the Secretary of State.
I will refer briefly to the question of job losses. We know the consequences and we accept the responsibilities for this. We refuse to accept that in the time-scale involved we cannot provide the necessary jobs. The tools are available to us, and if we need further tools we shall not hesitate to seek them.
I draw attention to the ECSC provisions about which I have been asked. We are in the middle of negotiating with ECSC for re-adaptation payments to help people who are made redundant by paying them a proportion of their previous earnings, a free training supplement and for a period of added unemployment pay if they are unemployed. Discussions are also current on the mechanics of reconversion payments.
I remind the House of what was said in the previous debate and what is said in the White Paper, that the finding of alternative employment is our primary task and the primary rôle that we seek to fill. We recognise that the loss of job opportunities creates particular problems in particular areas, and to the best of our ability we must find alternative jobs. The cornerstone of job replacement is growth in the economy. This job loss is to take place in a buoyant, growing economy with decreasing unemployment, and a fundamental basis of such an economy is a growing, competitive and efficient steel industry such as this strategy represents.
The White Paper outlines the strategy designed to carry BSC into the forefront of the world's steel industry and to keep it there. It is designed to give British industry steel of a quality and at a price which will enable us effectively to compete in world markets. It is designed to provide secure jobs, albeit fewer of them, for our steel workers. It anticipates the loss of job opportunities that will result and sets out the realistic way in which the Government, working with the unions and BSC, and making full use of the power they have, are tackling the problem. It contains the degree of flexibility that is essential in looking forward into the next decade.
Against this background the speeches of hon. Members on the Opposition benches strike discordant notes. On the one hand, they ask for greater capacity, regardless of the market projections and of whether the output can be sold. On the other hand, they seek to keep open

almost every existing steel plant, regardless of the effect that this would have upon the cost and quality of steel. They have once more displayed their ignorance of the economic facts of industrial life.

Whilst the Government and BSC must take full account of the social and regional problems that this strategy presents—and have done so and will continue to do so—nevertheless, at the end of the day, BSC must be a competitive and profitable business, making its full and vital contribution to the economic prosperity of the nation. We believe that the strategy outlined in the White Paper does just this. I therefore ask the House to reject the Opposition amendment and to approve the White Paper.

Question put, That the amendment be made:—

The House divided: Ayes 257, Noes 295.

Division No. 59.]
AYES
[10.0 p.m.


Abse, Leo
Davidson, Arthur
Hamilton, William (Fife, W.)


Allaun, Frank (Salford, E.)
Davies, Denzil (Llanelly)
Hannan, William (G'gow, Maryhill)


Allen, Scholefield
Davies, G. Elfed (Rhondda, E.)
Hardy, Peter


Archer, Peter (Rowley Regis)
Davies, Ifor (Gower)
Harper, Joseph


Armstrong, Ernest
Davis, Clinton (Hackney, C.)
Harrison, Walter (Wakefield)


Ashley, Jack
Davis, Terry (Bromsgrove)
Hart, Rt. Hn. Judith


Atkinson, Norman
Deakins, Eric
Hattersley, Roy


Bagier, Gordon A. T.
de Freitas, Rt. Hn. Sir Geoffrey
Healey, Rt. Hn. Denis


Barnes, Michael
Dell, Rt. Hn. Edmund
Heffer, Eric S.


Barnett, Guy (Greenwich)
Dempsey, James
Hilton, W. S.


Barnett, Joel (Heywood and Royton)
Devlin, Miss Bernadette
Hooson, Emlyn


Baxter, William
Dormand, J. D.
Houghton, Rt. Hn. Douglas


Beaney, Alan
Douglas, Dick (Stirlingshire, E.)
Howell, Denis (Small Heath)


Benn, Rt. Hn. Anthony Wedgwood
Douglas-Mann, Bruce
Huckfield, Leslie


Bennett, James (Glasgow, Bridgeton)
Driberg, Tom
Hughes, Rt. Hn. Cledwyn (Anglesey)


Bidwell, Sydney
Duffy, A. E. P.
Hughes, Mark (Durham)


Blenkinsop, Arthur
Dunnett, Jack
Hughes, Robert (Aberdeen, N.)


Boardman, H. (Leigh)
Eadie, Alex
Hughes, Roy (Newport)


Booth, Albert
Edelman, Maurice
Hunter, Adam


Bottomley, Rt. Hn. Arthur
Edwards, Robert (Bilston)
Irvine,Rt.Hn.SirArthur(Edge Hill)


Boyden, James (Bishop Auckland)
Edwards, William (Merioneth)
Janner, Greville


Bradley, Tom
Ellis, Tom
Jay, Rt. Hn. Douglas


Broughton, Sir Alfred
English, Michael
Jeger, Mrs. Lena


Brown, Hugh D. (G'gow, Provan)
Evans, Fred
Jenkins, Hugh (Putney)


Brown, Ronald (Shoreditch &amp; F'bury)
Ewing, Harry
Jenkins, Rt. Hn. Roy (Stechford)


Buchan, Norman
Faulds, Andrew
John, Brynmor


Buchanan, Richard (G'gow, Sp'burn)
Fisher, Mrs. Doris (B'ham,Ladywood)
Johnson, Carol (Lewisham, S.)


Butler, Mrs. Joyce (Wood Green)
Fitch, Alan (Wigan)
Johnson, James (K'ston-on-Hull, W.)


Campbell, I. (Dunbartonshire, W.)
Fletcher, Raymond (Ilkeston)
Johnson, Walter (Derby, S.)


Cant, R. B.
Fletcher, Ted (Darlington)
Johnston, Russell (Inverness)


Carmichael, Neil
Foot, Michael
Jones, Barry (Flint, E.)


Carter, Ray (Birmingh'm, Northfield)
Ford, Ben
Jones, Dan (Burnley)


Carter-Jones, Lewis (Eccles)
Forrester, John
Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)


Clark, David (Colne Valley)
Fraser, John (Norwood)
Jones, Gwynoro (Carmarthen)


Cocks, Michael (Bristol, S.)
Galpern, Sir Myer
Jones, T. Alec (Rhondda, W.)


Concannon, J. D.
Garrett, W. E.
Judd, Frank


Conlan, Bernard
Gilbert, Dr. John
Kaufman. Gerald


Corbet, Mrs. Freda
Ginsburg, David (Dewsbury)
Kelley, Richard


Cox, Thomas (Wandsworth, C.)
Golding, John
Kerr, Russell


Crawshaw, Richard
Gourlay, Harry
Kinnock, Neil


Cronin, John
Grant, George (Morpeth)
Lambie, David


Crosland, Rt. Hn. Anthony
Grant, John D. (Islington, E.)
Lamborn, Harry


Crossman, Rt. Hn. Richard
Griffiths, Eddie (Brightside)
Lamond, James


Cunningham, G. (Islington, S.W.)
Griffiths, Will (Exchange)
Latham, Arthur


Dalyell, Tam
Grimond, Rt. Hn. J.
Lawson George


Darling, Rt. Hn. George
Hamilton, James (Bothwell)
Leadbitter, Ted




Lee, Rt. Hn. Frederick
Orbach, Maurice
Smith, John (Lanarkshire, N.)


Lestor, Miss Joan
Orme, Stanley
Spearing, Nigel


Lewis, Arthur (W. Ham, N.)
Oswald, Thomas
Spriggs, Leslie


Lewis, Ron (Carlisle)
Owen, Dr. David (Plymouth, Sutton)
Stallard, A. W.


Lomas, Kenneth
Padley, Walter
Steel, David


Loughlin, Charles
Palmer, Arthur
Stewart, Donald (Western Isles)


Lyon, Alexander W. (York)
Pannell, Rt. Hn. Charles
Stewart, Rt. Hn Michael (Fulham)


Lyons, Edward (Bradford, E.)
Pardoe, John
Stoddart, David (Swindon)


Mabon, Dr. J. Dickson
Parker, John (Dagenham)
Stonehouse, Rt. Hn. John


McBride, Neil
Parry, Robert (Liverpool, Exchange)
Strang, Gavin


McElhone, Frank
Pavitt, Laurie
Strauss, Rt. Hn. G. R.


McGuire, Michael
Peart, Rt. Hn. Fred
Summerskill, Hn. Dr. Shirley


Mackenzie, Gregor
Pendry, Tom
Swain, Thomas


Mackie, John
Perry, Ernest G.
Thomas,Rt.Hn.George (Cardiff, W.)


Maclennan, Robert
Prentice, Rt. Hn. Reg.
Thomas, Jeffrey (Abertillery)


McMillan, Tom (Glasgow, C.)
Prescott, John
Tinn, James


McNamara, J. Kevin
Price, William (Rugby)
Tomney, Frank


Mallalieu, J. P. W. (Huddersfield, E.)
Probert, Arthur
Torney, Tom


Marks, Kenneth
Reed, D. (Sedgefield)
Tuck, Raphael


Marsden, F.
Rees, Merlyn (Leeds, S.)
Varley, Eric G


Marshall. Dr. Edmund
Rhodes, Geoffrey
Wainwright, Edwin


Mason, Rt. Hn. Roy
Richard, Ivor
Walden, Brian (B'm'ham, All Saints)


Mayhew, Christopher
Roberts, Albert (Normanton)
Walker, Harold (Doncaster)


Meacher, Michael
Roberts,Rt.Hn.Goronwy(Caernarvon)
Wallace, George


Mellish, Rt. Hn. Robert
Robertson, John (Paisley)
Watkins, David


Mendelson, John
Roderick, Caerwyn E.(Brc'n&amp;R'dnor)
Weitzman, David


Millan, Bruce
Rodgers, William (Stockton-on-Tees)
Wellbeloved, James


Miller, Dr. M. S.
Roper, John
Wells, William (Walsall, N.)


Milne, Edward
Rose, Paul B.
White, James (Glasgow, Pollok)


Mitchell, R. C. (S'hampton, Itchen)
Ross, Rt. Hn William (Kilmarnock)
Whitehead, Phillip


Morgan, Elystan (Cardiganshire)
Rowlands, Ted
Whitlock, William


Morris, Alfred (Wythenshawe)
Sandelson, Neville
Williams, Alan (Swansea, W.)


Morris, Charles R. (Openshaw)
Sheldon, Robert (Ashton-under-Lyne)
Williams, W. T. (Warrington)


Morris, Rt. Hn. John (Aberavon)
Shore, Rt. Hn. Peter (Stepney)
Wilson, Alexander (Hamilton)


Moyle, Roland
Short,Rt.Hn.Edward(N'c'tle-u-Tyne)
Wilson, Rt. Hn. Harold (Huyton)


Mulley, Rt. Hn. Frederick
Short, Mrs. Renée (W'hampton,N.E.)
Wilson, William (Coventry, S.) Woof, Robert


Oakes, Gordon
Silkin, Rt. Hn. John (Deptford)



Ogden, Eric
Silkin, Hn. S. C. (Dulwich)



O'Halloran, Michael
Sillars, James
TELLERS FOR THE AYES:


O'Malley, Brian
Silverman, Julius
Mr. Donald Coleman and


Oram, Bert
Skinner, Dennis
Mr. James A. Dunn.




NOES


Adley, Robert
Channon, Paul
Fookes, Miss Janet


Alison, Michael (Barkston Ash)
Chapman, Sydney
Fortescue, Tim


Allason, James (Hemel Hempstead)
Churchill, W. S.
Foster, Sir John


Amery, Rt. Hn. Julian
Clark, William (Surrey, E.)
Fowler, Norman


Archer, Jeffrey (Louth)
Clarke, Kenneth (Rushcliffe)
Fox, Marcus


Astor, John
Cockeram, Eric
Fraser,Rt.Hn.Hugh(St'fford &amp; Stone)


Atkins, Humphrey
Cooke, Robert
Fry, Peter


Awdry, Daniel
Coombs, Derek
Gardner, Edward


Baker, Kenneth (St. Marylebone)
Cooper, A. E.
Gibson-Watt, David


Balniel, Rt. Hn. Lord
Cordle, John
Gilmour, Ian (Norfolk, C.)


Batsford, Brian
Cormack, Patrick
Gilmour, Sir John (Fife, E.)


Beamish, Col. Sir Tufton
Costain, A. P.
Glyn, Dr. Alan


Bell, Ronald
Crouch, David
Goodhart, Philip


Bennett, Dr. Reginald (Gosport)
Crowder, F. P.
Goodhew, Victor


Benyon, W.
Davies, Rt. Hn. John (Knutsford)
Gorst, John


Berry, Hn. Anthony
d'Avigdor-Goldsmid, sir Henry
Gower, Raymond


Biffen, John
d'Avigdor-Goldsmid,Maj.-Gen.Jack
Grant, Anthony (Harrow, C.)


Biggs-Davison, John
Dean, Paul
Gray, Hamish


Blaker, Peter
Deedes, Rt. Hn. W. F.
Green, Alan


Boardman, Tom (Leicester, S.W.)
Digby, Simon Wingfield
Grieve, Percy


Body, Richard
Dixon, Piers
Griffiths, Eldon (Bury St. Edmunds)


Boscawen, Hn. Robert
Dodds-Parker, Douglas
Grylls, Michael


Bossom, Sir Clive
Douglas-Home, Rt. Hn. Sir Alec
Gummer, J. Selwyn


Bowden, Andrew
Drayson, G. B.
Gurden, Harold


Braine, Sir Bernard
du Cann, Rt. Hn. Edward
Hall, Miss Joan (Keighley)


Bray, Ronald
Dykes, Hugh
Hall, John (Wycombe)


Brewis, John
Eden, Rt. Hn. Sir John
Hall-Davis, A. G. F.


Brinton, Sir Tatton
Edwards, Nicholas (Pembroke)
Hamilton, Michael (Salisbury)


Brocklebank-Fowler, Christopher
Elliot, Capt. Walter (Carshalton)
Hannam, John (Exeter)


Brown, Sir Edward (Bath)
Elliott, R. W. (N'c'tle-upon-Tyne,N.)
Harrison, Brian (Maldon)


Bruce-Gardyne, J.
Emery, Peter
Harrison, Col. Sir Harwood (Eye)


Bryan, Sir Paul
Eyre, Reginald
Haselhurst, Alan


Buchanan-Smith, Alick(Angus,N&amp;M)
Farr, John
Hastings, Stephen


Buck, Antony
Fell, Anthony
Havers, Sir Michael


Bullus, Sir Eric
Fenner, Mrs. Peggy
Hawkins, Paul


Burden, F. A.
Fidler, Michael
Hayhoe, Barney


Butler, Adam (Bosworth)
Finsberg, Geoffrey (Hampstead)
Heath, Rt. Hn. Edward


Campbell, Rt.Hn.G.(Moray &amp; Nairn)
Fisher, Nigel (Surbiton)
Heseltine, Michael


Carr, Rt. Hn. Robert
Fletcher-Cooke, Charles
Hicks, Robert







Higglns, Terence L.
Mawby, Ray
Scott, Nicholas


Hiley, Joseph
Maxwell-Hyslop, R. J.
Shaw, Michael (Sc'b'gh &amp; Whitby)


Hill, John E. B. (Norfolk, S.)
Meyer, Sir Anthony
Shelton, William (Clapham)


Hill, S. James A.(Southampton,Test)
Mills, Peter (Torrington)
Shersby, Michael


Holland, Philip
Mills, Stratton (Belfast, N.)
Simeons, Charles


Holt, Miss Mary
Miscampbell, Norman
Sinclair, Sir George


Hordern, Peter
Mitchell, Lt.-Col. C. (Aberdeenshire, W)
Skeet, T. H. H.


Hornby, Richard
Mitchell, David (Basingstoke)
Smith, Dudley (W'wick &amp; L'mlngton)


Hornsby-Smith.Rt.Hn.Dame Patricia
Moate, Roger
Soref, Harold


Howe, Rt. Hn. Sir Geoffrey
Molyneaux, James
Speed, Keith


Howell, David (Guildford)
Money, Ernie
Spence, John


Howell, Ralph (Norfolk, N.)
Monks, Mrs. Connie
Sproat, Iain


Hunt, John
Montgomery, Fergus
Stainton, Keith


Hutchison, Michael Clark
More, Jasper
Stanbrook, Ivor


Iremonger, T. L.
Morgan, Geraint (Denbigh)
Stewart-Smith, Geoffrey (Belper)


Irvine, Bryant Godman (Rye)
Morrison, Charles
Stodart, Anthony (Edinburgh, W.)


James, David
Mudd, David
Stoddart-Scott, Col. Sir M.


Jenkin, Patrick (Woodford)
Nabarro, Sir Gerald
Stokes, John


Jennings, J. C. (Burton)
Neave, Airey
Stuttaford, Dr. Tom


Jessel, Toby
Nicholls, Sir Harmar
Sutcliffe, John


Johnson Smith, G. (E. Grinstead)
Noble, Rt. Hn. Michael
Tapsell, Peter


Jones, Arthur (Northants, S.)
Nott, John
Taylor, Sir Charles (Eastbourne)


Jopling, Michael
Onslow, Cranley
Taylor,Edward M.(G'gow,Cathcart)


Joseph, Rt. Hn. Sir Keith
Oppenheim, Mrs. Sally
Taylor, Frank (Moss Side)


Kaberry, Sir Donald
Owen, Idris (Stockport, N.)
Taylor, Robert (Croydon, N.W.)


Kellett-Bowman, Mrs. Elaine
Page, Rt. Hn. Graham (Crosby)
Tebbit, Norman


Kilfedder, James
Page, John (Harrow, W.)
Temple, John M.


Kimball, Marcus
Parkinson, Cecil
Thatcher, Rt. Hn. Mrs. Margaret


King, Evelyn (Dorset, S.)
Peel, Sir John
Thomas, John Stradling (Monmouth


King, Tom (Bridgwater)
Percival, Ian
Thomas, Rt. Hn. Peter (Hendon, S.


Kinsey, J. R.
Peyton, Rt. Hn. John
Thompson, Sir Richard (Croydon, S.


Kirk, Peter
Pike, Miss Mervyn
Tilney, John


Knight, Mrs. Jill
Pink, R. Bonner
Trafford, Dr. Anthony


Knox, David
Pounder, Rafton
Trew, Peter


Lambton, Lord
Powell, Rt. Hn. J. Enoch
Tugendhat, Christopher


Lamont, Norman
Price, David (Eastleigh)
Turton, Rt. Hn. Sir Robin


Lane, David
Prior, Rt. Hn. J. M. L.
Vaughan, Dr. Gerard


Langford-Holt, Sir John
Proudfoot, Wilfred
Waddington, David


Le Marchant, Spencer
Pym, Rt. Hn. Francis
Walder, David (Clitheroe)


Lewis, Kenneth (Rutland)
Quennell, Miss J. M.
Walker, Rt. Hn. Peter (Worcester)


Lloyd, Ian (P'tsm'th, Langstone)
Raison, Timothy
Walker-Smith, Rt. Hn. Sir Derek


Longden, Sir Gilbert
Ramsden, Rt. Hn. James
Wall, Patrick


Loveridge, John
Rawlinson, Rt. Hn. Sir Peter
Walters, Dennis


Luce, R. N.
Redmond, Robert
Ward, Dame Irene


McAdden, Sir Stephen
Reed, Laurance (Bolton, E.)
Wells, John (Maidstone)


MacArthur, Ian
Rees, Peter (Dover)
White, Roger (Gravesend)


McCrindle, R. A.
Rees-Davies, W. R.
Wiggin, Jerry


McLaren, Martin
Renton, Rt. Hn. Sir David
Wilkinson, John


Maclean, Sir Fitzroy
Rhys Williams, Sir Brandon
Winterton, Nicholas


McMaster, Stanley
Ridley, Hn. Nicholas
Wolrige-Gordon, Patrick


Macmillan,Rt.Hn. Maurice (Farnham)
Ridsdale, Julian
Wood, Rt. Hn. Richard


McNair-Wilson, Michael
Rippon, Rt. Hn. Geoffrey
Woodhouse, Hn. Christopher


McNair-Wilson, Patrick (NewForest)
Roberts, Wyn (Conway)
Woodnutt, Mark


Maddan, Martin
Rodgers, Sir John (Sevenoaks)
Worsley, Marcus


Madel, David
Rossi, Hugh (Hornsey)
Wylie, Rt. Hn. N. R.


Maginnis, John E.
Rost, Peter
Younger, Hn. George


Marples, Rt. Hn. Ernest
Royle, Anthony



Marten, Neil
Russell, Sir Ronald
TELLERS FOR THE NOES:


Mather, Carol
St. John-Stevas, Norman
Mr. Walter Clegg and


Maude, Angus
Sandys, Rt. Hn. D.
Mr. Bernard Weatherill.


Maudling, Rt. Hn. Reginald

Question accordingly negatived.

Main Question put:—

The House divided: Ayes 295, Noes 260.

Division No. 60.]
AYES
[10.12 p.m.


Adley, Robert
Benyon, W.
Brocklebank-Fowler, Christopher


Alison, Michael (Barkston Ash)
Berry, Hn. Anthony
Brown, Sir Edward (Bath)


Allason, James (Hemel Hempstead)
Biffen, John
Bruce-Gardyne, J.


Amery, Rt. Hn. Julian
Biggs-Davison, John
Bryan, Sir Paul


Archer, Jeffrey (Louth)
Blaker, Peter
Buchanan-Smith, Alick(Angus,N&amp;M)


Astor, John
Boardman, Tom (Leicester, S.W.)
Buck, Antony


Atkins, Humphrey
Body, Richard
Bullus, Sir Eric


Awdry, Daniel
Boscawen, Hn. Robert
Burden, F. A.


Baker, Kenneth (St. Marylebone)
Bossom, Sir Clive
Butler, Adam (Bosworth)


Balniel, Rt. Hn. Lord
Bowden, Andrew
Campbell, Rt.Hn.G.(Moray &amp; Nairn)


Batsford, Brian
Braine, Sir Bernard
Carr, Rt. Hn. Robert


Beamish, Col. Sir Tufton
Bray, Ronald
Channon, Paul


Bell, Ronald
Brewis, John
Chapman, Sydney


Bennett, Dr. Reginald (Gosport)
Brinton, Sir Tatton
Churchill, W. S.




Clark, William (Surrey, E.)
Hornsby-Smith.Rt.Hn.Dame Patricia
Parkinson, Cecil


Clarke, Kenneth (Rushcliffe)
Howe, Rt. Hn. Sir Geoffrey
Peel, Sir John


Cockeram, Eric
Howell, David (Guildford)
Percival, Ian


Cooke, Robert
Howell, Ralph (Norfolk, N.)
Peyton, Rt. Hn. John


Coombs, Derek
Hunt, John
Pike, Miss Mervyn


Cooper, A. E.
Hutchison, Michael Clark
Pink, R. Bonner


Cordle, John
Iremonger, T. L.
Pounder, Rafton


Cormack, Patrick
Irvine, Bryant Godman (Rye)
Powell, Rt. Hn. J. Enoch


Costain, A. P.
James, David
Price, David (Eastleigh)


Crouch, David
Jenkin, Patrick (Woodford)
Prior, Rt. Hn. J. M. L.


Crowder, F. P.
Jennings, J. C. (Burton)
Proudfoot, Wilfred


Davies, Rt. Hn. John (Knutstord)
Jessel, Toby
Pym, Rt. Hn. Francis


d'Avigdor-Goldsmid, Sir Henry
Johnson Smith, G. (E. Grinstead)
Quennell, Miss J. M.


d'Avigdor-Goldsmid, Maj.-Gen.Jack
Jones, Arthur (Northants, S.)
Raison, Timothy


Dean, Paul
Jopling, Michael
Ramsden, Rt. Hn. James


Deedes, Rt. Hn. W. F.
Joseph, Rt. Hn. Sir Keith
Rawlinson, Rt. Hn. Sir Peter


Digby. Simon Wingfield
Kaberry, Sir Donald
Redmond, Robert


Dixon, Piers
Kellett-Bowman, Mrs. Elaine
Reed, Laurance (Bolton, E.)


Dodds-Parker, Sir Douglas
Kilfedder, James
Rees, Peter (Dover)


Douglas-Home, Rt. Hn. Sir Alec
Kimball, Marcus
Rees-Davies, W. R.


Drayson, G. B.
King, Evelyn (Dorset, S.)
Renton, Rt. Hn. Sir David


du Cann, Rt. Hn. Edward
King, Tom (Bridgwater)
Rhys Williams, Sir Brandon


Dykes, Hugh
Kinsey, J. R.
Ridley, Hn. Nicholas


Eden, Rt. Hn. Sir John
Kirk, Peter
Ridsdale Julian


Edwards, Nicholas (Pembroke)
Knight, Mrs. Jill
Rippon, Rt. Hn. Geoffrey


Elliot, Capt. Walter (Carshalton)
Knox, David
Roberts, Wyn (Conway)


Elliott, R. W. (N'c'tle-upon-Tyne,N.)
Lambton, Lord
Rodgers, Sir John (Sevenoaks)


Emery, Peter
Lamont, Norman
Rossi, Hugh (Hornsey)


Eyre, Reginald
Lane, David
Rost, Peter


Farr, John
Langford-Holt, Sir John
Royle, Anthony


Fell, Anthony
Le Marchant, Spencer
Russell, Sir Ronald


Fenner, Mrs. Peggy
Lewis, Kenneth (Rutland)
St. John-Stevas, Norman


Fidler, Michael
Lloyd, Ian (P'tsm'th, Langstone)
Sandys, Rt. Hn. D.


Finsberg, Geoffrey (Hampstead)
Longden, Sir Gilbert
Scott, Nicholas


Fisher, Nigel (Surbiton)
Loveridge, John
Shaw, Michael (Sc'b'gh &amp; Whitby)


Fletcher-Cooke, Charles
Luce, R. N.
Shelton, William (Clapham)


Fookes, Miss Janet
McAdden, Sir Stephen
Shersby, Michael


Fortescue Tim
MacArthur, Ian
Simeons, Charles


Foster, Sir John
McCrindle, R A.
Sinclair, Sir George


Fowler, Norman
McLaren, Martin
Skeet, T. H. H.


Fox, Marcus
Maclean, Sir Fitzroy
Smith, Dudley (W'wick &amp; L'migton)


Fraser,Rt.Hn.Hugh(St'fford &amp; Stone)
McMaster, Stanley
Soref, Harold


Fry, Peter
Macmillan,Rt.Hn.Maurice(Farnham)
Speed, Keith


Gardner, Edward
McNair-Wilson, Michael
Spence, John


Gibson-Watt, David
McNair-Wilson, Patrick (New Forest)
Sproat, Iain


Gilmour, Ian (Norfolk, C.)
Maddan, Martin
Stainton, Keith


Gilmour, Sir John (Fife, E.)
Madel, David
Stanbrook, Ivor


Glyn, Dr. Alan
Maginnis, John E.
Stewart-Smith, Geoffrey (Belper)


Goodhart, Philip
Marples, Rt. Hn. Ernest
Stodart, Anthony (Edinburgh, W.)


Goodhew, Victor
Marten, Neil
Stoddart-Scott, Col. Sir M.


Gorst, John
Mather, Carol
Stokes, John


Gower, Raymond
Maude, Angus
Stuttaford, Dr. Tom


Grant, Anthony (Harrow, C.)
Maudling, Rt. Hn. Reginald
Sutcliffe, John


Gray, Hamish
Mawby, Ray
Tapsell, Peter


Green, Alan
Maxwell-Hyslop, R. J.
Taylor, Sir Charles (Eastbourne)


Grieve, Percy
Meyer, Sir Anthony
Taylor,Edward M.(G'gow,Cathcart)


Griffiths, Eldon (Bury St. Edmunds)
Mills, Peter (Torrington)
Taylor, Frank (Moss Side)


Grylls, Michael
Mills, Stratton (Belfast, N.)
Taylor, Robert (Croydon, N.W.)


Gummer, J. Selwyn
Miscampbell, Norman
Tebbit, Norman


Gurden, Harold
Mitchell,Lt.-Col.C.(Aberdeenshire,W)
Temple, John M.


Hall, Miss Joan (Keighley)
Mitchell, David (Basingstoke)
Thatcher, Rt. Hn. Mrs. Margaret


Hall, John (Wycombe)
Moate, Roger
Thomas, John Stradling (Monmouth)


Hall-Davis, A. G. F.
Molyneaux, James
Thomas, Rt. Hn. Peter (Hendon, S.)


Hamilton, Michael (Salisbury)
Money, Ernle
Thompson, Sir Richard (Croydon, S.)


Hannam, John (Exeter)
Monks, Mrs. Connie
Tilney, John


Harrison, Brian (Maldon)
Montgomery, Fergus
Trafford, Dr. Anthony


Harrison, Col. Sir Harwood (Eye)
More, Jasper
Trew, Peter


Haselhurst, Alan
Morgan, Geraint (Denbigh)
Tugendhat, Christopher


Hastings, Stephen
Morrison, Charles
Turton, Rt. Hn. Sir Robin


Havers, Sir Michael
Mudd, David
Vaughan, Dr. Gerard


Hawkins, Paul
Murton, Oscar
Waddington, David


Hayhoe, Barney
Nabarro, Sir Gerald
Walder, David (Clitheroe)


Heath, Rt. Hn. Edward
Neave, Airey
Walker, Rt. Hn. Peter (Worcester)


Heseltine, Michael
Nicholls, Sir Harmar
Walker-Smith, Rt. Hn. Sir Derek


Hicks, Robert
Noble, Rt. Hn. Michael
Wall, Patrick


Higgins, Terence L.
Nott, John
Walters, Dennis


Hiley, Joseph
Onslow, Cranley
Ward, Dame Irene


Hill, John E. B. (Norfolk, S.)
Oppenheim, Mrs. Sally
Wells, John (Maidstone)


Hill, S. James A.(Southampton, Test)
Owen, Idris (Stockport, N.)
White, Roger (Gravesend)


Holland, Philip
Page, Rt. Hn. Graham (Crosby)
Wiggin, Jerry


Holt, Miss Mary
Page, John (Harrow, W.)
Wilkinson, John


Hordern, Peter




Hornby, Richard









Winterton, Nicholas
Woodnutt, Mark



Wolrige-Gordon, Patrick
Worsley, Marcus
TELLERS FOR THE AYES:


Wood, Rt. Hn. Richard
Wylie, Rt. Hn. N. R.
Mr. Walter Clegg and


Woodhouse, Hn. Christopher
Younger, Hn. George
Mr. Bernard Weatherill.




NOES


Abse, Leo
Foot, Michael
Maclennan, Robert


Allaun, Frank (Salford, E.)
Ford, Ben
McMillan, Tom (Glasgow, C.)


Allen, Scholefield
Forrester, John
McNamara, J. Kevin


Archer, Peter (Rowley Regis)
Fraser, John (Norwood)
Mallalieu, J. P. W. (Huddersfield, E.)


Armstrong, Ernest
Galpern, Sir Myer
Marks, Kenneth


Ashley, Jack
Garrett, W. E.
Marsden, F.


Atkinson, Norman
Gilbert, Dr. John
Marshall, Dr. Edmund


Bagier, Gordon A. T.
Ginsburg, David (Dewsbury)
Mason, Rt. Hn. Roy


Barnes, Michael
Golding, John
Mayhew, Christopher


Barnett, Guy (Greenwich)
Gourlay, Harry
Meacher, Michael


Barnett, Joel (Heywood and Royton)
Grant, George (Morpeth)
Mellish, Rt. Hn. Robert


Baxter, William
Grant, John D. (Islington, E.)
Mendelson, John


Beaney, Alan
Griffiths, Eddie (Brightside)
Millan, Bruce


Benn, Rt. Hn. Anthony Wedgwood
Griffiths, Will (Exchange)
Miller, Dr. M. S.


Bennett, James(Glasgow, Bridgeton)
Grimond, Rt. Hn. J,
Milne, Edward


Bidwell, Sydney
Hamilton, James (Boihweil)
Mitchell, R. C. (S'hampton, Itchen)


Blenkinsop, Arthur
Hamilton, William (Fife, W.)
Morgan, Elystan (Cardiganshire)


Boardman, H. (Leigh)
Hannan, William (G'gow, Maryhill
Morris, Alfred (Wythenshawe)


Sooth, Albert
Hardy, Peter
Morris, Charles R. (Openshaw)


Bottomley, Rt. Hn. Arthur
Harper, Joseph
Morris, Rt. Hn. John (Aberavon)


Boyden, James (Bishop Auckland)
Harrison, Walter (Wakefield)
Moyle, Roland


Bradley, Tom
Hart, Rt. Hn. Judith
Mulley, Rt. Hn. Frederick


Broughton, Sir Alfred
Hattersley, Roy
Oakes, Gordon


Brown, Hugh D. (G'gow, Provan)
Healey, Rt. Hn. Denis
Ogden, Eric


Brown, Ronald (Shoreditch &amp; F'bury)
Heffer, Eric S.
O'Halloran, Michael


Buchan, Norman
Hilton, W. S.
O'Malley, Brian


Buchanan, Richard (G'gow, Sp'burn)
Hooson, Emlyn
Oram, Bert


Butler, Mrs. Joyce (Wood Green)
Houghton, Rt. Hn. Douglas
Orbach, Maurice


Campbell, I. (Dunbartonshire, W.)
Howell, Denis (Small Heath)
Orme, Stanley


Cant, R. B.
Huckfield, Leslie
Oswald, Thomas


Carmichael, Neil
Hughes, Rt. Hn. Cledwyn (Anglesey)
Owen, Dr. David (Plymouth, Sutton)


Carter, Ray (Birmingh'm, Northfield)
Hughes, Mark (Durham)
Padley, Walter


Carter-Jones, Lewis (Eccles)
Hughes, Robert (Aberdeen, N.)
Palmer, Arthur


Clark, David (Colne Valley)
Hughes, Roy (Newport)
Pannell, Rt. Hn. Charles


Cocks, Michael (Bristol, S.)
Hunter, Adam
Pardoe, John


Cohen, Stanley
Irvine, Rt. Hn Sir Arthur (Edge Hill
Parker, John (Dagenham)


Concannon, J. D.
Janner, Greville
Parry, Robert (Liverpool, Exchange)


Conlan, Bernard
Jay, Rt. Hn. Douglas
Pavitt, Laurie


Corbet, Mrs. Freda
Jeger, Mrs. Lena
Peart, Rt. Hn. Fred


Cox, Thomas (Wandsworth, C.)
Jenkins, Hugh (Putney)
Pendry, Tom


Crawshaw, Richard
Jenkins, Rt. Hn. Roy (Stechford)
Perry, Ernest G.


Cronin, John
John, Brynmor
Prentice, Rt. Hn. Reg.


Crosland, Rt. Hn. Anthony
Johnson, Carol (Lewisham, S.)
Prescott, John


Crossman, Rt. Hn. Richard
Johnson, James (K'ston-on-Hull, W.)
Price, William (Rugby)


Cunningham, G. (Islington, S.W.)
Johnson, Walter (Derby, S.)
Probert, Arthur


Dalyell, Tarn
Johnston, Russell (Inverness)
Reed, D. (Sedgefield)


Darling, Rt Hn. George
Jones, Barry (Flint, E.)
Rees, Merlyn (Leeds, S.)


Davidson, Arthur
Jones, Dan (Burnley)
Rhodes, Geoffrey


Davies, Denzil (Llanelly)
Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)
Richard, Ivor


Davies, G. Elfed (Rhondda, E.)
Jones, Gwynoro (Carmarthen)
Roberts, Albert (Normanton)


Davies, Ifor (Gower)
Jones, T. Alec (Rhondda, W.)
Roberts, Rt.Hn.Goronwy (Caernarvon)


Davis, Clinton (Hackney, C.)
Judd, Frank
Robertson, John (Paisley)


Davis, Terry (Bromsgrove)
Kaufman, Gerald
Roderick, Caerwyn E.(Brc'n&amp;R'dnor)


Deakins, Eric
Kelley, Richard
Rodgers, William (Stockton-on-Tees)


de Freitas, Rt. Hn. Sir Geoffrey
Kerr, Russell
Roper, John


Dell, Rt. Hn. Edmund
Kinnock, Neil
Rose, Paul B.


Dempsey, James
Lambie, David
Ross, Rt. Hn. William (Kilmarnock)


Devlin, Miss Bernadette
Lamborn, Harry
Rowlands, Ted


Dormand, J. D.
Lamond, James
Sandelson, Neville


Douglas, Dick (Stirlingshire, E.)
Latham, Arthur
Sheldon, Robert (Ashton-under-Lyne)


Douglas-Mann, Bruce
Lawson, George
Shore, Rt. Hn. Peter (Stepney)


Driberg, Tom
Leadbitter, Ted
Short, Rt.Hn.Edward(N'c'tle-u-Tyne)


Duffy, A. E. P.
Lee, Rt. Hn. Frederick
Short, Mrs. Renée (W'hampton, N.E.)


Dunnett, Jack
Lestor, Miss Joan
Silkin, Rt. Hn. John (Depttord)


Eadie, Alex
Lewis, Arthur (W. Ham, N.)
Silkin, Hn. S. C. (Dulwich)


Edelman, Maurice
Lewis, Ron (Carlisle)
Sillars, James


Edwards, Robert (Bilston)
Lipton, Marcus
Silverman, Julius


Edwards, William (Merioneth)
Lomas, Kenneth
Skinner, Dennis


Ellis, Tom
Loughlin, Charles
Smith, Cyril (Rochdale)


English, Michael
Lyon, Alexander W. (York)
Smith, John (Lanarkshire, N.)


Evans, Fred
Lyons, Edward (Bradford, E.)
Spearing, Nigel


Ewing, Harry
Mabon, Dr. J. Dickson
Spriggs, Leslie


Faulds, Andrew
McBride, Neil
Stallard, A. W.


Fisher,Mrs. Doris (B'ham,Ladywood)
McElhone, Frank
Steel, David


Fitch, Alan (Wigan)
McGuire, Michael
Stewart, Donald (Western Isles)


Fletcher, Raymond (Ilkeston)
Mackenzie, Gregor
Stewart, Rt. Hn. Michael (Fulham)


Fletcher, Ted (Darlington)
Mackie, John








Stoddart, David (Swindon)
Varley, Eric G.
Williams Alan (Swansea, W.)


Stonehouse, Rt. Hn. John
Wainwright, Edwin
Williams, W. T. (Warrington)


Strang, Gavin
Walden, Brian (B'm'ham, Alf Saints)
Wilson, Alexander (Hamilton)


Strauss, Rt. Hn. G. R.
Walker, Harold (Doncaster)
Wilson, Rt. Hn. Harold (Huyton)


Summerskill, Hn. Dr. Shirley
Wallace, George
Wilson, William (Coventry, S.)


Swain, Thomas
Welkins, David
Woof, Robert


Thomas,Rt.Hn.George (Cardiff,W.)
Weitzman, David



Thomas, Jeffrey (Abertillery)
Wellbeloved, James
TELLERS FOR THE NOES


Tinn, James
Wells, William (Walsall, N.)
Mr. Donald Coleman and


Tomney, Frank
White, James (Glasgow, Pollok)
Mr. James A. Dunn.


Torney, Tom
Whitehead, Phillip



Tuck, Raphael
Whitlock, William





Question accordingly agreed to.


Resolved,


That this House approves the White Paper, British Steel Corporation: Ten Year Development Strategy (Command Paper No. 5226).

BUSINESS OF THE HOUSE

Ordered,
That the Coal Industry Bill and the Fire Precautions (Loans) Bill may be proceeded with at this day's Sitting, though opposed, until any hour.—[The Prime Minister.]

Orders of the Day — COAL INDUSTRY BILL

As amended (in the Standing Committee), considered.

New Clause 1

AID FOR MINING

'The Board shall have power to provide to any person or organisation, on terms they consider to be suitable commercial terms, advice and assistance "other than financial assistance" on or in connection with mining or mineral preparation in any part of the world'.—[Mr. John.]

Brought up, and read the First time.

10.25 p.m.

Mr. Brynmor John: I beg to move, That the Clause be read a Second time.

Mr. Deputy Speaker (Sir Robert Grant-Ferris): With the new clause it will be convenient to take Amendment No. 6, in Title, line 9, after 'redundant', insert
'to empower the Board to provide advice and assistance on commercial terms in connection with mining'.

Mr. John: The new clause would enable the National Coal Board, upon suitable commercial terms, to render assistance, other than financial assistance, on or in connection with mining or mineral preparation in any part of the world.
Amendment No. 6 relates to the Long Title and paves the way to enable this matter to be discussed.
This proposal is strongly advocated by British manufacturers of mining equipment and by those who make coal preparation plant. I believe that the NCB would consent to having this additional power. Indeed, I think that it would welcome it.
Although the Bill talks about an industry which is financially dependent, in mining expertise it is one of the most highly qualified industries in the world. It has been written about in many publications. The expert skills which the miners and the mining engineers in Britain have developed in the era since nationalisation have put them ahead of most other countries, particularly in long-wall mining.
In consequence of the nationalisation of the industry in 1946 the NCB has gathered within itself all the expertise in mining. The Board does not depend, as the old coal owners did, on outside private consultants. However, since this has been accompanied by a view on the part of the board that it was precluded by the Act from providing consultancy services, it has meant that the amount of advice which Britain can tender to other countries has been limited. Indeed, the advice that Britain could give through private consultants has got steadily out of date, because the experience gained by outside private consultants in the mining industry has been less relevant over the years.
There is considerable evidence to suggest that Australia and Canada, to name but two of a number of countries, would have given consultancy contracts to British mining engineers had they thought that the quality of the advice they could get from Britain would be adequate for the tasks before them. Had they had National Coal Board mining engineers available to tender this advice, those consultancy contracts would have been granted.
Our immediate European neighbours have such organisations. For example, Germany has Montan, which is controlled by the big German mining combine of Ruhrkokl AG, and France has the Sofremines, which is controlled by Charbonnage de France.
It is worth describing the latter organisation in a little more detail, because in the past few years its consultancy services have won contracts in Zambia, Greece, Morocco, Ghana, Turkey, Algeria, Tunisia and South America. It is obviously a very successful consultancy organisation. It brings to France a great deal of prestige and income.
10.30 p.m.
The organisation acts as a mining consulting engineering practice, undertaking


the preparation of feasibility studies and the assessment of capital costs. It will also undertake new mining ventures in any part of the world. Its permanent staff is only 48, but it can borrow experts in a particular subject for short periods on payment for their services.
As a result of that consultancy service being available from France, a number of contracts have been won in foreign countries. British manufacturers are so keen on the idea of a British consultancy service because their chances of selling their mining equipment to foreign countries are less without it.
I must re-emphasise that our coal preparation equipment, as well as our general mining equipment, is probably better than any in the world, but it is natural that many of the orders for mining equipment follow the consultancy arranged for the venture. This is where Sofremine's experience comes in. A great deal can be done by way of steering and advice as to what type of equipment can be bought. It is no exaggeration to say that that is exactly what Sofremine has done in almost every country in which it has won consultancies. It has steered to France the capital equipment provision for the venture in question, and big capital equipment exports have been won by France as a result.
The world demand for energy is likely to quadruple in the next 30 years. Whatever our arguments about the relative merits of other sources of fuel, a large part in meeting that quadrupled demand must be played by the discovery and exploitation of fresh sources of coal. The establishment of a consultancy service such as the clause would enable would open up the possibility of our exporters of mining equipment being able to enter into fair competition. That possibility is at present denied them because of the absence of such a service.
I should like to state briefly what I believe to be the advantages to this country of setting up such a consultancy service. First, considerable consultancy fees would be earned by the National Coal Board in foreign currencies. For example, in 1968 the turnover of Sofremine was 20 million francs. Secondly, it would make possible increased markets for British capital goods as a result of the

consultancy being tendered by Britain rather than other countries. Thirdly, there would be an indirect benefit to the NCB if those who supplied it with capital equipment also had large export orders, resulting in lower operating costs.
There is good precedent for such consultancy services in the nationalised industries. British Rail has a company known as Transmark Ltd., which gives advice on railway matters all over the world. This has resulted in a fair number of orders to United Kingdom suppliers. Although it has not been long established, I believe that the company is already showing a profit. I should be obliged if the Minister would deal with this matter when he winds up the debate.

Mr. Albert Roberts: I was under the impression that the National Coal Board already had power to provide information and consultancy services where necessary. I should like to know where that has not been possible.

Mr. John: I am obliged to my hon. Friend the Member for Normanton (Mr. Albert Roberts) for that comment. I think that the power to which he refers is Section 5 of the Coal Industry Act 1971. That deals with agreements in connection with overseas aid, with the consent of the Secretary of State and the Minister of the Crown having functions with regard to overseas aid. That is not my case. I am saying that the National Coal Board, as a matter of commercial practice to assist itself and British industry generally, should be able to undertake commercial contracts in countries which may not be the subject of overseas aid such as Canada and Australia where consultancy contracts would have come to this country if people of the calibre available to the NCB had been able to advise the Canadians and Australians.
I have referred already to Transmark Ltd. In addition, the British Steel Corporation has advised upon steel plants in Mexico, and the Post Office has the right to undertake consultancy services regarding telecommunications.
What we suggest is by no means a novel proposition. The arguments are wholly in its favour. If the House were to accede to the amendment, we should ensure that Britain and British mining engineers played their full part in the


expansion of world coal production in the future. I hope that the Minister will tell us his thinking on the matter and that he will accept the amendment. I know that certain discussions have gone on between manufacturers and himself and probably between the NCB and himself. I hope that he will not be merely negative on this matter but will allow the NCB to be adventurous and full of willingness to impart its expertise on commercial terms to the rest of the world.
British mining has a great deal to be proud of in terms of the standard of qualification of its mining engineers. This might be imparted to the rest of the world with profit to us all.

Mr. Peter Rees: I must congratulate the Opposition on their ingenuity. Faced with a Bill which has done more for the mining industry than anyone inside or outside the industry could have dreamed in their most optimistic moments, obviously they have found it difficult to embellish the Bill in any way, and I suppose that the clause is the result of burning a good deal of midnight oil.
I am in favour of the thinking underlined in the clause. While I am not for the National Coal Board becoming an ill-defined conglomerate, I am all for the recognised expertise developed by its primary activity being exploited commercially.
What is the reason for the clause? What is the demand for it? I look at Section 1 of the Coal Industry Nationalisation Act 1946, which I believe equips the board with all the powers that it needs. Admittedly it limits the board to the winning of coal in Great Britain, but its ancillary powers are wide enough to enable it to branch out in this work—

Mr. John: indicated dissent.

Mr. Rees: The hon. Member for Pontypridd (Mr. John) disagrees. No doubt with his well-known legal expertise he has given the NCB different advice. However, I still believe that Section 1 covers this proposed activity.
I am never for inflicting on a long-suffering industry more verbiage than is absolutely necessary. This is political rhetoric which will confuse rather than clarify the situation. Therefore while I

sympathise with the thinking underlying the clause, I cannot support it.

Mr. John Morris: I support my hon. Friends. I find it difficult to follow the argument of the hon. and learned Member for Dover (Mr. Peter Rees) in that he seemed to approve of the principle but says that if he finds there are no powers in existence he would not approve of the amendment.
I find it odd that the board does not already have these powers. The board has the monopoly of winning coal in this country. It allows a number of licences for the smaller mines but generally the whole of the consultancy of the country is part of the organisation of the board. There are some other consultants without the board but obviously, because of the monopoly position, they have tended to wither away over the years. This is why it is odd that this power does not appear to be part of the vires of the board.
The board has great experience. If we allowed it to give this kind of service it would be able to provide a complete service for the organising of coal mining in another country. It could organise it from start to finish, from the survey to the time when the mine was operating. In a contracting industry there must be an area for expansion. This was one of the philosophies behind our attempt to ensure that the board was able to participate in the investigation and exploration of North Sea gas. It is important that the board should be able to send out its teams on commercial terms and to cross-fertilise with countries overseas.
When I was in the Ministry of Transport we gave every encouragement to British Rail to provide such a service. It is one of the facts of life that if consultants go overseas they tend to recommend machinery and services from their own country. They do not always do so, but that is where the bias lies. British engineering has a great interest in the National Coal Board being able to exercise this kind of power because then it will be able to get a fair crack of the whip.
The Germans and the French have this power and send consultants to all parts of the world who recommend machinery


and services from their respective countries. I will not go into the proud record of the National Coal Board. There are plenty of examples of its fine work. I hope the Minister will not approach this in a doctrinaire way but will give it a fair hearing. If he is not able to accept it tonight I hope that he will not reject it out of hand.

Mr. Tom Swain: Would my right hon. Friend not agree that, now we are in the Common Market and the Iron and Steel Community, our coal-producing friends in the Community have a decided advantage over us unless the Government accept this amendment?

Mr. Morris: My hon. Friend strengthens my argument. With the free movement of industry and workers these countries will have twice the edge on our industry. They will be able to roam this country and elsewhere. It is doubly important that our industries should be able to do the same. All I ask the Minister is that he should not reject it out of hand but should consider the representations that have been made. Let him enter into further talks with representative parts of our engineering industries and give the assurance that when the Bill goes to another place he will consider introducing an appropriate amendment. I cannot understand how other British nationalised industries have this power while the National Coal Board does not.

10.45 p.m.

The Under-Secretary of State for Trade and Industry (Mr. Peter Emery): The debate has been useful and I wish on behalf of the Government to say that of course we want to see the special expertise which exists in the National Coal Board, which is second to none in certain spheres of activity among the coal mining industries of the world, being used not only to assist other countries in their mining problems but also, as outlined in the clause, in helping British mining contractors and the coal preparation plant manufacturers in exporting their products.
The hon. Member for Pontypridd (Mr. John) began by talking about the particular factors of retreat mining, where we lead the world, and he is quite right.

I wish also to refer to the remarks of the right hon. Member for Aberavon (Mr. John Morris), who said that the advice should be given on a commercial basis and that there should be a charge for the expertise in order that the NCB could obtain some benefit. That statement plucked at my heart strings. The situation, however, is one which deserves to be studied. We must understand that if we can obtain a share of this expanding market and export coal machinery it will be of benefit to our export trade and the board will benefit from the longer production runs, as was explained by the hon. Member for Pontypridd when he moved the clause.
I want to bring the House up to date and to deal with the point raised by the hon. Member for Normanton (Mr. Albert Roberts). The NCB has had discussions with the Association of British Mining Equipment Exporters—ABMEX as most of us know it—and with the British Consultants Bureau with a view to the board providing an overseas advisory service. It is important that such a service should be based upon co-operation with all the parties concerned and that the interest of the consultants in these matters should be brought in, because that is what people abroad want.
I understand that discussions have reached an advanced stage and I have every reason to hope that they will be completed shortly. The board has the power to undertake this form of overseas service. It does not need new powers. Any overseas activities which are not covered, as outlined by my hon. and learned Friend the Member for Dover (Mr. Peter Rees), could be covered by Section 2 of the Coal Industry Act 1949. That will enable the board to carry on activities prescribed in that Act outside Great Britain.
I am satisfied that an order under that section would be adequate for all purposes outlined in the clause and therefore I believe that points raised by hon. Members on both sides are fully covered. I am pleased to be able to say that the NCB is happy about its position and therefore I believe that the clause is unnecessary. I thank the hon. Member for Pontypridd for bringing this matter to the attention of the House because it has been a useful debate and I hope—

Mr. Eric Ogden: Is it correct that the hon. Gentleman says that if the board wishes to go into a form of partnership with private enterprise consultants it is free to operate in that way, and by so doing can even go ahead into other parts of the world, but that if it wishes to act as consultants and advisers directly to a foreign company or Government it would need an order to allow it to do so?

Mr. Emery: That is not quite the situation. The board can already give advice, usually not on a commercial basis, outside this country. I had already said that if the board wished to enter the type or structure which I have outlined powers exist for it so to do. I cannot, however, allow the word "partnership" to crop up, because consultants have to be very careful that they are not aligned with people who are actually marketing the machinery. So the British Consultants Bureau would not be able to go into that type of operation on a partnership basis. None the less, the scheme I have outlined would be possible.

Mr. John Morris: Do I understand that if an order such as the hon. Gentleman has mentioned were passed the new clause would not be needed, as all the powers it seeks would be covered by the order? Further, is the Minister now telling the House that, if the board so required, approval for the order would be given, and all the necessary preliminaries put into effect?

Mr. Emery: No, the right hon. Gentleman is not quite right there. What I am saying is that under the present legislation consultancy powers exist which the NCB has used. If, as has at one time been suggested, those powers were not adequate the position could then be covered by an order, and I have indicated that the Government would be happy to bring in an order to ensure that we could go forward on the lines I have outlined.

Mr. Alex Eadie: To some extent the hon. and learned Member for Dover (Mr. Peter Rees) may regret that he was so quick on the draw by alleging that we were trying to embellish the Bill and indulging in political rhetoric. The Minister in his usual candid way has told us that the mere fact of bringing in the new clause is a contribution.
There seems to be unanimity between the two sides that if we can do anything to help exploit the country's commercial expertise it is a good thing to do. We are pleased that the Minister has spoken in that way, because some of us have been conscious for some time that there is a commercial advantage to be gained from using the board's technical expertise. There can be no argument about the fact that within the structure of the board—and this has become more apparent since our entry into Europe—we have probably the most highly sophisticated and technically advanced coal industry in the world. It would therefore be foolish if we as a nation were not to exploit that advantage to the full.
We may be talking here about employment. It has always appeared to us that there was scope for us to use the board's consultancy services to deal with contraction in the mining equipment manufacturing industries.
When we tabled the amendment I discovered that it proposed nothing new. We are proposing something that already comes within the ambit of the Gas Council. Paragraphs 68, 69 and 70 of the Annual Report and Accounts of 1971–72 of the Gas Council contain information on how the council sells its expertise. That is beneficial to the nation and spells out additional employment and prosperity. Paragraph 68 is as follows:
British gas industry technology and expertise are being utilised to an ever-increasing extent in many regions of the world. During the year under review, support was extended to a number of British companies in connection with gas-related projects overseas; work was carried out in 14 countries, and the promotion and exploitation of process technology has resulted in the creation of a new industry—the substitute natural gas industry.
The Minister will recollect that I have often questioned him on the experiment being conducted in Westfield, an opencast site in the county in which I live. If this new process is successful it will have dramatic results in relation to synthetic natural gas, and will mean prosperity for the people who have been engaged on the work.
Paragraph 69 is as follows:
Consultancy agreements were entered into to provide assistance to such countries as Brazil, India, New Zealand, Indonesia, Norway, Russia, Poland and South Africa. Support was guaranteed for many other projects overseas,


including several in the South American countries whose rapid industrial expansion has generated much interest in the increased utilisation of gas.
Paragraph 70 states:
Training facilities in several specialised fields were made available for visitors from Pakistan, Japan. Iran, Singapore and New Zealand, and visitors from many other countries were received.
The report goes on to describe the technical processes that have been introduced.
The hon. and learned Member for Dover may be upset because he was so quick on the draw, but our proposition is not new. If the Gas Council does this, why cannot the National Coal Board do likewise?
I have been pressing the Government about the offshore engineering industry. Why should we have to depend on technology from Massachusetts for that industry? The difficulty there is that we do not have the expertise. I have appealed to the Government to build up expertise. The time will come when we shall want to sell that expertise overseas, because the search for oil will continue for another 30, 40 or 50 years. The possession of expertise is of great commercial and financial benefit to the nation.
I want to get clear the question of legality. To some extent legality was on our side when we started to probe the question of legal provision. But lawyers spoke in the debate, so in the way of legal argument I have had it.
The Minister said that if necessary the Government would be prepared to bring in an order which would amplify and strengthen the situation. I understand, therefore, that the hon. Gentleman is taking account of the point I am making, perhaps inadequately, by substantiating the fact that in the NCB we have great expertise which could be profitable to the nation. Presumably he means that by such an order he will give the NCB the aid which will enable it to perform a task similar to that of the Gas Council and which is so profitable to the nation.

11.0 p.m.

Mr. Emery: I have the pleasant duty, in which I am certain I have the support of all right hon. and hon. Members, of congratulating the hon. Member for

Midlothian (Mr. Eadie), on his first speech from the Opposition Front Bench. I sincerely hope that he will make many more speeches from the Opposition Front Bench.
I do not pull his leg, however, when I say that he must know that we have a high opinion of the standing he has achieved both in the House and in the Labour Party as an expert on coal mining, and I am delighted to see that it has brought him his promotion to the Front Bench. [HON. MEMBERS: "Hear, hear."] I realise only too well the expertise which the British gas industry has been able to use in advising people in many parts of the world—indeed, not only the supply of expertise but through gas contracts as far away as Jakarta. It is an expertise which has been built up in friendly co-operation with gas consultants. I believe that if it is necessary to bring in an order to achieve that type of approach for the coal industry, it will fall within the context which I gave the House earlier. With that assurance, I hope that the motion and clause will be withdrawn.

Mr. John: In view of what the hon. Gentleman has said, I believe that the National Coal Board and the other interested parties will have every incentive to come to a quick agreement. I beg to ask leave to withdraw the motion.

Motion, and clause, by leave, withdrawn.

Clause 3

EXTENSION OF POWER TO MAKE GRANTS TO BOARD IN CONNECTION WITH PIT CLOSURES.

Mr. Emery: I beg to move Amendment No. 1, in page 4, line 17, leave out from 'Grants' to 'shall' in line 18 and insert:
'made under that section in respect of any financial year of the Board'.
This is a clarifying amendment, promised to the Standing Committee by my hon. Friend the Minister of State, Welsh Office. It clarifies the wording of the Bill, something which we non-lawyers like to achieve in legislation. It makes clear that the 50 per cent. limit is applicaable not only up to March 1976 but in any year in which grants may be made


under the clause. It is, of course, in connection with pit closures.

Amendment agreed to.

Clause 9

REGIONAL GRANTS

Mr. Michael McGuire: I beg to move Amendment No. 3, in page 8, line 38, at end insert:
'including such sums as are necessary to ensure that the long term capacity for utilising coal in the generation of electricity is secured'.

Mr. Deputy Speaker: With this we shall take Amendment No. 4, also stand-in the name of the hon. Member for Ince (Mr. McGuire) and his hon. Friends, in page 8, line 40, at end, insert:
'or be less than £150 million'.

Mr. McGuire: I shall be concentrating mainly on Amendment No. 3. Amendment No. 4 is a floor amendment because the previous provision for assistance for extra coal burn—£45 million—in a previous Act, as my hon. Friend the Member for Chesterfield (Mr. Varley) said, was only half used. Considering the state the industry was in, that was probably a misfortune.
Clause 9, which we believe is the most important, is one which we wish to debate again on Report, because when we debated it in Committee we were not satisfied with the short and curt answer we received from the Minister of State at the Welsh Office.
The Government tell us that the purpose of the Bill is to support the industry, certainly for three years, and probably for five. We think that this is not looking to the long term half enough. We accept the tactics in the Bill but dispute the strategy. The Minister for Industry on Second Reading on 21st December, as reported at column 1607 of the OFFICIAL REPORT, told us that three-quarters of all miners work in special development areas or assisted areas and that a further 15 per cent. are employed in derelict land clearance areas, and that these areas have lost 230,000 jobs in the last decade. I and my colleagues believe that any further loss of jobs in these regions would turn them into deserts. That would not compensate us for the deserts we have lost overseas.
We believe that the way to maintain present employment and to increase it is to ensure that the present amount of coal burn is secured and to make plans to increase it. This means building more new power stations. Drax B and West Burton are a must. Drax B was given ministerial approval a long time ago. It was announced by my right hon. Friend the Member for Manchester, Cheetham (Mr. Harold Lever), on 29th October, 1969.
Contrary to what the Minister said in winding up the debate on this clause in Committee, this is very relevant to the Bill because the Bill is designed to give a feeling of security to men in the coal industry. What better boost to morale could they have than an announcement that the Government would take the necessary steps to have Drax B built, together with West Burton? That would galvanise the industry and put new heart into men and management. That is the one reason for the Bill. We have the argument that if the Government were to announce a new coalfired power station now, it would be six years before it came on stream and that it would have no immediate effect, but that is all the more reason for announcing it now.
I am a little puzzled about the Minister's powers in regard to coal-fired power stations. In Committee the Minister said that Drax B was in the programme and still is, but that unless the CEGB requested permission to build it nothing would be done about it. That cannot be the position of the present Government or any other Government. I agree with the doctrine of no governmental interference in the day-to-day running of the nationalised industries. But the securing of an adequate supply of power using the national resources in the widest and best interests of the community is far removed from that doctrine if applied in the manner which the Minister has indicated when we have debated this matter.
The Government's policy is to say, "It is there. Planning permission was given, albeit by a previous Government. We have not removed it from the programme but unless the CEGB requests permission to build we shall do nothing about it." If that policy were carried out, it would amount to dereliction of duty because it would undermine the whole effect of the


Bill. The Government would be giving for short-term measures something which is being undermined right from the start, because coal burn is inextricably linked with the fortunes of the National Coal Board. Unless we can guarantee and improve that position, in three to five years' time, with the extension on the Bill, we shall be coming forward possibly for another resuscitation job, whereas we have the chance to do something positive about it now.
New coal-fired power stations are absolutely necessary in the interests of not only the National Coal Board but also the nation. We all know of the worldwide concern about the energy supply position. Now that the Americans have settled the Vietnam question we know, from The Times of yesterday, that President Nixon's first priority is to secure for the United States of America their energy supply position. He does not want that to be jeopardised. He can read the signs. I believe that our Government could read the signs when they introduced the Bill. We want to help them read the signs a little more clearly.
The Government should step in. Their power is not negative. For proof of that we can read Select Committee reports. The Chairman of the CEGB, Mr. Arthur Hawkins, said in evidence to the Select Committee that the Hartlepools nuclear power station was not programmed for an increase in power, but that it was to replace obsolete stations. So we want new coal-fired power stations to replace obsolete coal-fired stations.
One of the most powerful arguments of the CEGB is that the older coal-tired power stations are more costly than it would like them to be, but that its best and most profitable power stations are coal-fired stations. Therefore, if we can get modern coal-fired stations replacing our obsolete stations, in addition to Drax B and West Burton, the coal burn which the Government want and for which they have made provision in the Bill will be dramatically increased.
The power of the Minister is not negative. It is not just to say that it is in the programme but that unless the request is made there is little that he can do although he would like to do something to help us. Hartlepools was helped.

The Government had to give permission and to find the capital. One of the pressure groups in the nuclear power station industry has been the builders of the power stations, who have pressed the Government to influence the CEGB. Mr. Arthur Hawkins says that it was not the board's wish at all. There was pressure on the Government, who must have used the stick or the carrot on the CEGB.
11.15 p.m.
Everyone knows that my constituency is Ince. When I heard the announcement of an oil-fired power station at Ince I rushed around for clarification, but it was the Ince in Cheshire. Mr. Hawkins tells us that the Ince power station was also the direct result of Government intervention. When it has been a question of building coal-fired power stations, the Government have shown a supine attitude. When it has been nuclear power stations, or Ince B oil-fired, they have been galvanised into action. We want to see some of that action resulting in coal-fired stations, like Drax B and West Burton, and a replacement programme for our obsolete coal-fired stations. That would be a wise policy which would underpin the Bill.
In Committee, my hon. Friend the Member for Mansfield (Mr. Concannon) rightly said what we have said in previous coal debates, that, unless we can secure for the National Coal Board a long-term coal-fired power station policy and an increase in coal burn, all the efforts on the Bill will prove to have been in vain. We have such a chance. The Minister has the power, it will make the Bill sensible, and we shall start on the road to a wise energy policy. Otherwise the Bill will be something that no one in the House or the industry really wants—merely a holding operation.
I am looking forward to the Minister telling us that he is convinced that the power station programme as I have outlined it needs this policy. I hope that he will not simply say that the CEGB has not asked about it yet. The CEGB unfortunately will not come forward. My hon. Friend the Member for Chesterfield in Committee quoted some damaging statements by the CEGB, showing its attitude to coal-fired stations—in colloquial language, it will not touch them with a barge pole.
I have here a summary of the CEGB's Annual Report for 1971–72. About ten times in various paragraphs, it says, in effect, "Unless we are forced by the Government, we shall not have any more coal-fired power stations." The board is prepared to risk our energy supply future on systems as yet unproved. This is dangerous. It is not in the national interest.
We ask the Minister to get off his backside and tell the CEGB that it will have these coal-fired stations. It is in the interests of the board, the industry and the nation. I ask the Minister to get cracking. Without such a policy the Bill will be simply a holding operation. We believe that it could be the start of a real energy policy for this country.

Mr. Adam Butler: The hon. Member for Ince (Mr. McGuire) has managed to bring in a pretty good, if short, review of energy policy on Amendment No. 3 and possibly on No. 4.
I should like to take up some of the points that the hon. Gentleman made. Whether his information is totally different from mine regarding generating costs, I do not know. My information comes from Mr. Hawkins, whom the hon. Gentleman mentioned on a number of occasions. I was given comparative costs of generating from nuclear fuel, oil and coal. The coal-fired stations used were the last eight to be built, so presumably they were the most efficient and economic. The average costs for electricity generation from coal are the most expensive of the three fuels. Indeed, oil with its handicap of the fuel levy is equal on these figures to generation from nuclear power. The Magnox stations were running below capacity at that time, because of technical difficulties. However, taking the fuel levy off oil, the costs from oil generation were significantly better and more attractive than generating from coal. This is a somewhat different picture from that presented by the hon. Gentleman.
I should also like to take up the point about the fuel scene as it differs between the American situation over the next few years and our own. The Americans are facing what can only be described as a serious crisis in the next decade regarding fuel supplies. A number of authorities have shown that the Americans will be

importing at least—possibly considerably more than—half of their oil supplies which will impose considerable strains on, among other things, their balance of payments. Therefore, they must look to improving their indigenous sources of supply.
However, in our case it can be shown, again on good authority, that by 1980 we shall nearly be self-sufficient from our own sources of supply provided that we continue to generate electricity from coal to the present extent and provided, as seems likely, that there are one or possibly two more major finds of oil in the North Sea. This presents a totally different picture of the Government's fuel policy.
Those two points together suggest that the hon. Gentleman's argument that we should be investing in new coal-fired stations is completely wrong. I might go with him on dual firing, but certainly not on the expenditure necessary to build entirely new coal-fired stations.
The hon. Gentleman argued that it would put heart into the industry if such stations were built. Yet at the same time in Amendment No. 4, by trying to put a floor rather than a ceiling on the expenditure, he is assuming that there will be contraction in the industry. With respect, he cannot argue both ways—argue that the industry should expand and supply more coal for electricity generation and, in another amendment, both being taken together for the purposes of the debate, imply that there will be contraction because he is asking for a minimum of £150 million to moderate contraction in the industry.
It is unrealistic not to expect some contraction to take place, but we cannot at the moment foresee how much. It will depend upon many factors. It will depend on the pattern of the fuel scene over the next few years. It will depend not least upon the successful use of the moneys provided under Clause 6 for subsidising coal for electricity generation. But the main factor on which it will depend is the reaction of the industry and the men who work in it to the Bill, and one can argue, as I seek to do, that the rate of contraction, and therefore the rate of redundancy, will depend to a large extent on them.
I believe that they will accept both the challenge and the opportunity which the Bill offers, and therefore at this point I reject the concept implied in Amendment No. 4 of a minimum amount.

Mr. J. D. Concannon: On looking through HANSARD I see that I had quite a good run on this clause in Committee. I said then that I was disappointed at the outcome of the debate on the clause and that we would have to return to it on Report. Having listened to the hon. Member for Bosworth (Mr. Adam Butler), all that I can do is to invite him to look more closely at the clause and the Bill which I regard as a three- to five-year short-term measure.
The hon. Gentleman referred to Mr. Hawkins. Having met him, I assure the hon. Gentleman that my opinion of Mr. Hawkins is that he could make a case on any power station on any figures that anyone cared to give. I thought that he got to the point of confusing everybody at the meeting. The only relevant fact that we got out of him is that the Radcliffe-on-Soar power station is the cheapest. That is the last station to come on to generating power, and it is the last coal-fired station to be built.

Mr. Butler: Does the hon. Gentleman know of any reason why Mr. Hawkins should present an incorrect picture to me? I asked him a straight question about the comparative costs of generating electricity from the various fuels and he presented the figures in what I thought was a fair way. He gave an average picture of costs in each case, and that is what I have presented to the House.

Mr. Concannon: All I am saying is that, having listened to Mr. Hawkins, it is my view that he could prove anything to anyone's satisfaction. He uses the snake in the tunnel argument, and it all depends on where one runs the line or the tunnel. I do not want to enter into an argument about this.
The hon. Gentleman said that the future of the industry depended upon the men in it. To a great extent I agree with him, but if the men do not get the hardware the Bill will become a nonsense. No matter how good the men are, it is no use asking them to increase their production if there are no outlets for it

and no hardware with which to do the job. The outlets are the new power stations of Drax B and West Burton. If these do not come into stream then one can say that by 1980, no matter how efficient the National Coal Board or the miners are, there is bound to be a gradual rundown of the industry.
I do not want to detain the House, and I shall conclude by drawing attention to Amendment No. 4 which envisages a sum of not less than £150 million. The National Coal Board has an opportunity to give regional grants to the tune of £210 million over three years, or £70 million a year. That is the minimum. We tried in Committee to discover what criteria the board had to fulfil to claim regional grant. We thought the provision woolly and on Second Reading extracted a promise from the Minister to spell out in Committee the intentions of the Clause. But we were given no such information. I expected the Government to table an amendment to Clause 9, but again I have been disappointed because no such provision has been tabled. Therefore, Amendment No. 4 seeks to protect the industry to ensure that the words which have been uttered in these discussions are put into concrete form in the form of the sum of £150 million over three years.

11.30 p.m.

Mr. Peter Rees: When I read Amendment No. 3 I am reminded that my Conservative predecessor in the Dover constituency, Sir John Arbuthnot, was primarily responsible for ensuring that the Richborough power station was designed to burn coal—an achievement for which he received inadequate acknowledgment. Times have changed and there is now an assured future for the East Kent coalfield because coking coal can readily be sold to the steel industry.
I recognise that there are less-favoured coalfields, and this is where I take issue with the hon. Member for Ince (Mr. McGuire). The Bill is not a holding operation. It is not designed to remedy the ravages, if that is what they were, of the past. It is designed to provide a massive injection of capital to make the industry commercially robust, viable and competitive. It will provide reassurance


to those who work in the industry because it will indicate that the Government believe that it has a commercial future and is prepared to provide the necessary capital to exploit the markets which are open to the industry.
It must be emphasised that we have the largest coal industry in the Common Market. We have the men, the expertise and the reserves of coal and now, thanks to this Bill, we shall have the capital. I do not believe we need go beyond that and introduce a permanent distortion into another industry. I hope the hon. Member for Mansfield (Mr. Concannon) will forgive me for taking issue with him. He says that this is only a short-term method. Clause 9 refers to the period 1974–1976. But the amendment says:
including such sums as are necessary to ensure that the long-term capacity for utilising coal in the generation of electricity is secured".
In other words, the Opposition are suggesting that the Central Electricity Generating Board should be subsidised to adopt a form of generation that it would not adopt on a purely commercial analysis.

Mr. Concannon: That is entirely our suggestion. I do not dissent from what the hon. and learned Gentleman is attributing to us. Unless we have that provision the Bill is a nonsense. It is a nonsense if we do not have the outlets in the 1980s for the coal that we are now giving the NCB the opportunity to dig. That would mean chucking good money after bad.

Mr. Rees: I understood the hon. Gentleman's theme. I was merely picking up a point he took against my hon. Friend the Member for Bosworth (Mr. Adam Butler), whom he accused of not having read the clause. My hon. Friend is capable of looking after himself, but I was pointing out that the amendment is not short term, but, as the hon. Gentleman rightly said, is intended to provide a long-term market for coal that might not otherwise exist if the CEGB analysed the position rigorously and commercially.

Mr. Concannon: I could not have put it better myself.

Mr. Rees: It is rare for me to receive a compliment from the hon. Gentleman, so I am doubly grateful for it.
The hon. Gentleman is asking that, on the basis of a lavish injection of public money, a decision be taken which might not be justified on strictly commercial grounds. There are good commercial and strategic reasons for basing ourselves a little more on coal, but let us not do it just because of the liberal infusion of public money, because we are nervous about the coal industry. We must get away from this pessimism. The point of the Bill is that the industry now has the capital. It has the reserves, the men, the money. Cannot we look forward to a rosy future? Must we introduce this distortion into another industry?
The amendment offers the coal industry a crutch at the expense of another industry, a crutch that the coal industry no longer needs. I hope that the hon. Gentleman will not feel it necessary to press the amendment to a Division.

Mr. John Golding: For most of today we have discussed the steel industry. The closure of steel plants, such as Shotton or possibly Shelton, has an impact in my constituency not only upon steel workers but upon the mining industry. The Government's steel proposals will reduce the demand for coal from the pits in my constituency. Therefore, we must look for alternative, assured markets. One market over which we have some degree of control is that of the Central Electricity Generating Board.
This country has no fuel policy. We have a system of competition between oil, gas and coal and possibly atomic energy. Each management does its best to look after the efficient running of its own industry, but what is best for each industry is not necessarily best for the country.
Decisions that can be inconsistent with one another are being taken by individual nationalised industries. That is the point of asking that the CEGB be asked to encourage not just dual-firing but investment in coal-burning power stations. It is nonsense to pour public money into an industry like the coal industry in a variety of ways and at the same time to take decisions about investment in electricity generation which mean there will be no demand for coal. The investment decisions should be taken together.
I link with that the thought that one of the oddities at present is that in each of the nationalised industries there is a pricing system based on Government interference. At the same time it is clear that nationalised industry investment decisions are based on the present level of prices. Very little consideration is being given to the likelihood of changes in price levels.
It is almost certain that the price of oil will rise dramatically, even if Britain becomes self-sufficient in oil in the 1980s. If America has to import half her oil requirements, that of necessity will have a tremendous impact on the world price of oil, which will rocket. If British oil produced in the 1980s is exported to America, it is not likely to be sold to the CEGB at a price lower than the world price.
Although the production of British oil is important strategically, it is also important because it means that we can no longer use the argument that we must use our indigenous fuel, coal. All that matters is that the world price of oil, including British oil, will rocket. Is not it nonsense in those circumstances to be investing heavily in oil-burning power stations when it is known that the price of the raw material will increase by the 1980s.
This point applies to dual firing. It is not good enough for the CEGB to say that in order to meet the situation where the price of oil is likely to rocket in the 1980s it will now have dual-firing systems, burning oil until it becomes more expensive, and in the 1980s possibly turning to coal. Recent experience has shown that it is not possible to open pits which have been shut and to increase, reduce, increase, reduce output. Once it has been decided not to extract coal, that coal is denied us for a long time to come except at great expense.
It is an absurdity for decisions being made in the nationalised industries not to be made together, taking account of the forecasts of the very high price of oil in the 1980s.

11.45 p.m.

Mr. Joseph Harper: The hour is late and most of what can be said about our amendments has already

been said. Clause 9 was inserted into the Bill by the Government to assist the board in handling contracts with industry. The industry is in the assisted areas which is a new word for development and intermediate areas. That is the nub of the problem. The hon. Member for Bosworth (Mr. Adam Butler) made two points about Mr. Hawkins and the figures he had received from him. A few months ago I and many of my colleagues visited Mr. Hawkins in the East End of London. When I came away from that meeting one of my colleagues said, "What did you reckon to that, Joe?" I said, "Not much, he's no friend of ours".
That was forcibly brought home. Mr. Hawkins will not use coal if he can use some other kind of fuel. "Sufficient unto the day is the evil thereof" is the motto of Mr. Hawkins. He does not want coal. He made that perfectly clear and then he had the audacity, when we were leaving, to say "You ought to be the electricity lobby, not just the coal lobby". I could have told him, if I had not been polite, what he could have done with that one!
Anyone can make figures fit. In the figures which Mr. Hawkins gave it was made clear that oil was as cheap as nuclear energy. I do not know about that, because the Magnox station programme was, in our opinion, much too large. I do not know whether development costs were taken into account. Those would make it uneconomic. We are trying to get a long-term solution to the coal problem. We have reserves of 100 years waiting to be mined. As my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) has said, once men leave the pits they do not come back. We cannot re-open pits that have been closed. We cannot return to them in 20 years' time when the price of oil is astronomical and the supply of nuclear power has not risen to the heights expected of it. Once the men leave they do not return.
My hon. Friend the Member for Mansfield (Mr. Concannon), my hon. Friend the Member for Midlothian (Mr. Eadie), myself—and all 29 of us who were formerly miners will certainly not go back to the pits. What applies to us applies to others.

Mr. Peter Rees: May I correct the hon. Gentleman on one point? Although I have not worked in the industry—leaving aside politics—there are many of my constituents who work in the pits in East Kent. In the summer they work on the ships and in the winter they work underground, where it is much warmer.

Mr. Harper: They could do many things in the summer. I am talking about the men who dedicate their lives to working, in the industry. We have to plan our energy policy. If we can provide a fuel policy, so much the better. As my hon. Friend the Member for Newcastle-under-Lyme said, oil will be in such demand that future supplies will not be able to meet it. Whenever the Americans come in they force up prices. It has happened in Hong Kong, in Vietnam and wherever the Americans have gone. They have forced up prices and they will force us out so that we shall have to depend on coal for the next 30 or 40 years at least. Until we get the advanced gas-cooled reactor we shall not get economic power from nuclear stations. It takes six years from the time a decision is taken to build a power station until it comes into operation.
It is no good mining coal if there is nowhere to burn it and the only place to burn it is in coal-fired power stations. If we are to derive the full benefits of what the Government are proposing in the Bill this point must be dealt with. In a recent debate on Yorkshire and Humberside I asked for two new pits to be sunk in the Selby area. It is no use operating pits which cannot produce coal economically because the seams, the conditions and the geological strata are bad—pits where the men are working too hard for the returns. In order to burn the coal that these two pits will produce we have asked that Drax B should be coal fired. It was said earlier that my right hon. Friend the Member for Manchester. Cheetham (Mr. Harold Lever) decided that Drax B should be coal fired. That decision was made before my right hon. Friend became a Minister by my right hon. Friend the Member for Barnsley (Mr. Mason). It came as part of a package. I cannot remember the names of the other two or three stations, but one was to be oil fired, Drax B was to be coal fired and the third was to be nuclear powered.
We must pressurise the CEGB into making a firm statement that Drax B and West Burton should be coal fired and that there will be an immediate start to the planning and building of these stations. The fact that the Government are providing £210 million over three years does not mean that the money can be thrown away. It should be spent wisely and well, but it should be spent in the industry—and what better way to spend it than in the way that I have suggested?
During that debate the Minister, in order to get out of replying, said that he would ask the Chairman of the NCB to reply to me. A few weeks later I received a letter in which the Chairman said that I had suggested
that the Minister should press the Board to sink two new collieries in the East Riding of Yorkshire in order to increase productivity by working thicker seams.
Drilling is now in progress in the Selby area to determine the extent, thickness and quality of reserves of coal, the existence of which was proved by preliminary drilling during the period 1964 to 1967 to establish the north-easterly extension of the concealed coalfield of Yorkshire. Current drilling results are encouraging but it is too early to evaluate the full potential of the coalfield extension, or indeed its limits, and further drilling will be necessary before it is possible to assess the mining prospects in this district.
But the jewel in the reply is where it goes on to say:
There are, however, more immediate prospects for two new drift mines in our Barnsley and South Yorkshire Areas.
The board therefore agrees that there is a case for new mines, whether they be deep or drift, in order to build up long-term security for coal supplies.
I remember a former Minister of Power producing in 1967 a White Paper, with which we never agreed, in which he virtually asked, "Tell me where I can burn the stuff—I have mountains of it." That coal has now all gone. If anything was proved wrong it was that 1967 White Paper. We do not want any more disasters like that, because ours is art industry which, more than any other, has had the traumatic experience of losing men through redundancy. The money which the Government have put into the industry must be used wisely and well in the long-term interests of coal mining. It must not be dissipated.
By the 1971 Coal Industry Act a sum of £45 million was provided for extra coal burners, of which about 50 per cent. was used. All we now ask is that the money provided be used properly to give us value and make the industry viable and able to meet the country's demands on it the most economical way.
I do not know whether the Government intend to accept the amendment, but I shall be very surprised if they do. I must point out that when he was Chairman of the Public Accounts Committee my right hon. Friend the Member for Cheetham, in the Second Report dated 24th January 1972, showed conclusively, by questioning officials at the DTI, that Magnox power stations are not economical, that it will not be until 1985 at the earliest that nuclear power stations with gas-cooled reactors, and perhaps with the fast-breeder reactors, will generate energy in such quantity that coal, oil and natural gas will not longer be needed. We have not reached that stage yet, and no-one now in the House will live to see it reached. As it is, we are dependent on coal, and we have plenty of it. The Minister should give serious consideration to the amendments.

12 midnight.

Mr. Emery: I fully appreciate the way in which the arguments have been advanced, but before answering them let me make it quite clear that the amendments relate to Clause 9 which deals specifically with regional grants. The clause gives the Secretary of State a new power to make regional grants to the board in a way that we have never had in any previous coal legislation. I am delighted to see the hon. Member for Mansfield (Mr. Concannon) nodding his head—he is an expert in these matters. I think the House will welcome this innovation which will be of assistance to the industry.
Amendment No. 3 attempts to secure the utilisation of coal in the generation of electricity. But the grants should be used for the utilisation of domestic coal, coking coal or any other sort of coal. The Government do not want to impose any limitations, and the amendment appears to introduce a specific limitation.
Amendment No. 4 substitutes a bottom stop for a top stop by the insertion of the words
or be less than £150 million".
Hon. Gentlemen on the Opposition benches I am sure wish to be as careful in the expenditure of the taxpayers' money as we do. If they were the Government they would never insist that a certain amount of money must be spent regardless of the conditions. No reasonable Government in any legislation would attempt to introduce a bottom stop as the amendment seeks to do.
The hon. Member for Mansfield in Committee said that he would want to pursue this matter further on Report. I will tell the House how we see the regional grants being used, which is what the amendments are designed to probe. The amounts will be decided annually in advance after a review of the hoard's plans and annual prospects. The amount of the grant will depend absolutely on the annual operating forecasts of the NCB and the requests made by the NCB to the Government. It is not tied exclusively to specific coalfields, because the board will continue to be managed as a whole. The emphasis will be on moderating contraction, particularly in the assisted areas. I am sure that is the emphasis which hon. Members will wish to support.
The annual amounts will depend on the board's performance in the various regions, and the external factor of the amount of coal that has been burned. The grant is for recurrent expenditure. The board's capital expenditure will be met from its own resources and by borrowing from the National Loan Fund. The amounts will be decided after full consideration of the investment programme. The provision extends only for three years, and normal parliamentary control will apply to the expenditure.
This assistance represents a new aspect of coal legislation. It is designed specifically to aid mines in the assisted areas where closures produce problems of greater magnitude than elsewhere. That is basically the philosophy on which the Government have been operating.
The hon. Member for Mansfield will recall an answer I gave last week about Drax B power station. I pointed out that whilst planning permission had been


given for Drax B, no further application had come from the Central Electricity Generating Board. Part of the argument of the hon. Member for Mansfield, the hon. Member for Ince (Mr. McGuire) and the hon. Member for Pontefract (Mr. Harper) is that, irrespective of that, the Government should force the hand of the board. That was the basis of their approach. But Section 2(5) of the Electricity Act, 1957 says that the board has a statutory duty
…to develop and maintain an efficient, coordinated and economical system of supply of electricity in bulk for all parts of England and Wales.…
It was given the responsibility by this House and no Minister should attempt to override that statutory duty. The board will come forward with an application for a new power station when it feels it is necessary to meet requirements.
I do not think that the House wants, and it seems fairly nonsensical to suggest that it would want, the board to have so many power stations as to provide a level of generation very much greater than the nation needs. I do not believe that any Minister worth his salt would advocate that type of policy.

Mr. McGuire: Mr. Arthur Hawkins told the Select Committee on 2nd August:
As I see the responsibility placed on me and on the Board, it is to produce electricity economically.…As you know this has been published. The government have stepped in and have made arrangements.
He was referring to the early ordering of the Ince B oil-fired station. He went on:
As I see it, this is something we can do in collaboration with the government but I think it is arising from the initiative of manufacturers and government and not from the initiative of the CEGB.
So the Minister does have a part to play in this.

Mr. Emery: It would be wrong to demand a degree of ordering which goes against the legislative requirements of the Act. The Ince B power station would have been ordered in any case a few months or perhaps a year later. It was a requirement of the board. But the Government said to the board, as they said to all the nationalised industries, that if it could accelerate certain projects it was planning it should do so, in view of the unemployment situation. That policy received the support of both sides of the

House, and it was sensible. I accept the points made by the hon. Member for Pontefract and by my hon. Friend the Member for Bosworth (Mr. Adam Butler) about world energy structure and the immense importance and relevance which all nations will have to attach to the statement which we are informed President Nixon will be making within the next few weeks. I believe that he will be putting forward expenditure proposals for the American nation for drilling for oil, obtaining new hydrocarbon sources, the need for further development of coal and for the whole gamut of energy in America. There will be a shortage of oil and hydrocarbons, if one looks at the increasing demand which America, Japan, Europe and ourselves will make over the next decade or two. For that reason and many others, the Government have thought it right and proper to spend the massive amount provided for in this Bill an amount which nobody should underestimate. The Government want and intend to have an industry which can viably have mechanisation, modernisation and financial support.

Mr. Harry Ewing: We have heard that before.

Mr. Emery: Of course we have, but that does not mean that it is wrong to try to work for it. That is surely what the coal mining industry wants more than anything else. One of the most encouraging things in the working out of this Bill was the way in which all three unions co-operated, jointly with the National Coal Board.

Mr. Edwin Wainwright: Mr. Edwin Wainwright (Dearne Valley) rose—

Mr. Emery: The hon. Gentleman, who has not spoken in the debate, has a right to intervene in a coal mining debate.

Mr. Wainwright: In the efforts to see that we have a viable coal-mining industry, will the Government bear in mind the wages of coal miners so as to make sure that we have the personnel essential to provide the required coal?

Mr. Emery: I hope we shall not get into a debate on wages in coal-mining industry. The situation has been clearly understood by the unions as well as everybody else—that management, Government and unions all have to work to


contain costs. In the 20-point plan which the unions put forward, they accepted that increased wages could be achieved only by containing costs and dealing with productivity. Nobody, including the miners, would want to see the industry harmed all over again as it was last year.
Before I get more out of order, I shall come back to the debate on the amendment, which has been useful in allowing the House to obtain information from the Government on the manner in which regional grants will be used. For all the reasons I have given we would not want a bottom stop, nor to have one type of use spelt out. That would be unacceptable to hon. Gentlemen opposite. I hope the debate has been useful, with the Amendments as a basis for discussion.

12.15 a.m.

Mr. Eadie: I am very grateful to the Minister for his complimentary and encouraging remarks towards me during our previous debate. I shall not detain the House long.
The debate has been well worth while. My hon. Friend the Member for Ince (Mr. McGuire), in his customary way, told the House that one does not have to gaze into the crystal ball because one can look at the book. Looking at the book one finds that there is a worldwide shortage of energy. The House would be rather foolish if it ignored that factor which has emerged. Indeed, my hon. Friend advanced a very powerful case for coal-fired power stations. I concede to the Minister that to some extent we return to the debate on Clause 9. I was not a member of the Committee because, like the Minister, I was involved in other Committee work. I still am so involved, and have been all day. However, I have read all the debates, as he has.
When we were debating Clause 9 there was an argument about the whole Clause, that it introduced, as the Minister said, a new aspect in relation to Government assistance and sustenance to the mining industry. My hon. Friend the Member for Mansfield (Mr. Concannon) talked about "may" and "shall". We felt that it was too permissive, and that the Bill would certainly have been stronger if the permissive aspect of Clause

9 were removed and more mandatory provision were made about how the money should be allocated and spent.
The Government did not agree about that. I understand the Government's point of view. But this fits in to the whole question of coal-fired power stations. In answer to the Opposition, the Government developed their argument that they were talking primarily about assisted areas and that, therefore, the money would be more or less earmarked for the assisted areas. They dealt with the question of helping, probably, pits or areas which had been uneconomic, and suggested a genuine attempt by the Government to try to modify the severe contraction in industry in the assisted areas.
There is logic in what my hon. Friends have said. If one talks about assisting assisted areas, one then talks about the outlet that the production of coal has in those areas. The main outlet for the mining industry at present is coal-fired power stations. Therefore, it is logical that my hon. Friends should argue on the lines that coal-fired power stations should he earmarked for some of the money. We were not talking about just first aid. We always appreciate first aid, but we were thinking along the lines of giving more adequate sustenance.
The name of Mr. Hawkins has emerged in the debate, and various comments have been made. To some extent I am sorry that it was mentioned. We have credited Mr. Hawkins with capabilities that he does not possess. The hon. Member for Bosworth (Mr. Adam Butler) introduced the name. Neither the Government Front Bench nor miners will thank the hon. Gentleman for trying to suggest to the House that if it wants to know anything about energy policy it should discuss it with Mr. Hawkins. Mr. Hawkins knows something about the electricity industry, but he is not a wizard on the question of an energy policy. He has the responsibility for running a very important industry. I am sorry that the hon. Gentleman brought him into the discussion.
We have met Mr. Hawkins. His philosophy is that an energy shortage is propaganda. Whenever he said that to us, any meaningful discussion was terminated. As my hon. Friend said, if one reads the


book, one knows that there will be an energy shortage.

Mr. Adam Butler: I would not want the hon. Member to misrepresent me, as he has done in two ways. First, when he checks HANSARD tomorrow, he will find that the first reference to the chairman of the board was by his hon. Friend the Member for Ince (Mr. McGuire). Second, my only reference to him was to quote him as a source of information about the comparative costs of generating electricity from different fuels. As the hon. Gentleman said, surely the one thing the chairman of the board knows about is electricity generation and its cost.

Mr. Eadie: I try to speak with conviction in the House and I never willingly give offence to anyone, but I am very aggressive in the way I speak. It is perhaps the way I was brought up. I have spoken more at the pithead than in the House of Commons. One tends therefore to develop a style that people sometimes misunderstand. If I misrepresented the hon. Gentleman, that was not my intention.
But the name of Mr. Hawkins was brought in. The hon. Gentleman must concede that the reports of the CEGB and SSEB show that there has been a campaign by those organisations. The miners in Bosworth will not be pleased with the hon. Member's contribution. He brought in the hoary old argument about the fuel tax. It is a source of revenue, and if the Chancellor decided that it should go, he would have to look elsewhere for a source of revenue. We have argued this inside out.
The hon. Member was very suspicious about a national fuel policy. We have some technology with regard to nuclear power stations, and they are producing and generating electricity, but for £2,000 million and the contraction of the mining industry, it has not been a good buy. The hon. Member may appreciate that argument, because he was talking about what was commercial.
There will inevitably be contraction in mining if we do not, for example, do more pit sinkings. Our point, which I think the Government are coming around to—this is part of the reason for the Bill—is that this country can no longer afford to watch the mining industry contract as

it has been doing. We believe that it is in the interests of the nation that the industry should be sustained and a level of production maintained in it. Some hon. Members might suggest that this argument whether there should be contraction arose from the Rothschild "think tank" which we used to discuss. However, we are satisfied about this matter.
If the hon. Member for Bosworth is concerned about profitability and viability, I have some figures about energy requirements in this country. Britain is at present dependent on imports of about 45 per cent. of our energy. So what are we worried about? It is a substantial figure. Therefore, if we can maintain a strong, viable coalmining industry, we should not be looking about trying to contract any indigenous resource; we should be looking to contracting some other resource outwith. As we are members of the Common Market now, that 45 per cent. is more in the region of about 60 per cent.
I should have liked to go on at some length, but I will close on this point. The Under-Secretary mentioned that the predicament of energy shortage in the world was highlighted because of the American experience. Many people are no doubt prepared to predict that because America has done the necessary study and work, because it is a large consumer of energy, and because it finds that it will no longer have indigenous supplies of energy, it will probably have to devalue its currency again. This is very serious. It is serious in both British and world terms. If America has an appetite for ever more energy, there will be less available for other parts of the world. In consequence, the price factor will probably increase.
The Government's policy of saying, "Yes, we want to maintain a strong, viable coal industry", is not propaganda. The evidence and the figures are there if we want to examine them. I counsel the hon. Member for Bosworth and other hon. Gentlemen to study our energy requirements and to realise the serious predicament in which we are. If they can introduce some morale and hope into the mining industry and convince miners, who work in a dangerous, arduous job, that the nation is starting


to plan its indigenous energy resources, not only the miners, but the whole nation, will gain an advantage.
I should have liked to develop other matters. However, the debate has been worth while. I hope that the statements that have been made by my hon. Friends and I will be listened to, not only by the miners but by the country at large.

Mr. McGuire: Though I am not absolutely satisfied with the answers that the Minister has given, we have had some clarification on regional policy. We hope that our arguments about the coal-fired power stations will percolate through and that we shall get some action in that respect. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed.

FIRE PRECAUTIONS (LOANS) BILL

As amended (in the Standing Committee), considered.

Clause 1

LOANS TO MEET CERTAIN EXPENDITURE OCCASIONED BY FIRE PRECAUTIONS ACT 1971

12.30 a.m.

The Under-Secretary of State for the Home Department (Mr. David Lane): I beg to move Amendment No. 1, in page 2, leave out lines 1 to 9 and insert:
'(2) If the local authority consider that the applicant

(a) can reasonably be expected to meet obligations assumed by him in pursuance of this section in respect of a loan of the amount of the expenditure to which the application relates, or
(b) cannot reasonably be expected to meet obligations so assumed by him in respect of a loan of that amount, but can reasonably be expected to meet obligations so assumed by him in respect of a loan of a smaller amount,

the local authority may, if they think fit, offer to make to the applicant a loan of the appropriate amount on such terms (including terms as to the provision of security or guarantees) as may be specified in the offer.
In this subsection "the appropriate amount", in a case falling within paragraph (a) above, means the amount of the expenditure to which the application relates, and in a case falling within paragraph (b) above means the smaller amount there referred to.
(3) Subject to subsection (4) below, a loan under this section shall bear interest either—

(a) at the rate which, on the date of acceptance of the offer to make the loan, is the rate for the time being determined by the Treasury in accordance with section 5 of the National Loans Act 1968 in respect of local loans made on the security of local rates on that date and for the same period as that loan, or
(b) if the local authority so determine, at a rate higher by one quarter per cent. than that rate.
In this subsection "local loans" and "made on the security of local rates" have the same meanings as in section 6(2) of the National Loans Act 1968.
(4) Where, on the date of acceptance of an offer to make a loan under this section, there are two or more rates of interest for the time being determined by the Treasury as mentioned in subsection (3) above, the reference in that subsection to the rate so determined shall be read as a reference to such one of those rates as may be specified in a direction given by the Treasury for the purposes of this section; and the Treasury shall cause any such direction to be published in the London and Edinburgh Gazettes as soon as may be after giving it.'
I believe that it may be for the convenience of the House if with this we take the following Amendments:
No. 4, in page 2, line 1, leave out subsection (2) and insert:
'(2) The provisions of the Schedule to this Act shall apply in relation to an application made under subsection (1) of this section'.
Amendment No. 5 new Schedule:

'PROVISIONS AS TO LOANS

1. The local authority may if they think fit offer to enter into a contract with the applicant for a loan of an amount reasonably required to meet the obligations imposed by the notice mentioned in paragraph (b) of subsection (1) of section 1 of this Act.

2. The loan shall then be on interest at a rate not more than one quarter per cent. higher, and not lower than the rate mentioned in subsection (4) of section 36 of the Fire Precautions Act 1971.

3. The loan together with all interest due thereon shall until recovered be a charge on the premises to which the notice mentioned in paragraph 1 hereof relates and on all estates and interests therein.

4. The terms of the loan may provide that where the applicant does not have an estate in fee simple absolute in possession in the said premises that (without prejudice to any antecedent breach of the terms of the loan) the applicant's obligation to repay the loan shall cease when the applicant's interest in the said premises ceases.

5. Subsections (7) to (9) of section 36 of the Fire Precautions Act 1971 shall in addition to the foregoing provisions apply to the provisions of this Schedule notwithstanding that section 36 has not been brought into operation'.

I hope that that is agreeable to the hon. Member for Norwood (Mr. John Fraser).

Mr. John Fraser: Yes.

Mr. Lane: I am obliged to the hon. Gentleman.
Before I speak directly to the amendments and explain their purpose I should like to make two introductory points. The first is to remind the House that the Government are relying on everybody concerned to make sure that there is a sense of urgency in applying the main Fire Precautions Act. The safety of the public has to be the paramount factor, and I am sure that that will be kept in mind in the months and years ahead. Enforcement is a matter for the fire authorities. We believe from our information that steady progress is being made in enforcing the Act. We want this steady progress to continue and we believe that the Bill will be of considerable help in that direction.
My second comment by way of introduction is directed mainly to my hon. Friends, but also to some hon. Gentlemen opposite. There has been some anxiety that the provisions in the Bill for local authorities to make loans are discretionary and not mandatory. This is something that we have considered very carefully, and I remind my hon. Friends of a number of points which give me confidence in saying, as I did a moment ago, that the Bill will be useful even as a discretionary provision.
We see this as a co-operative matter between fire authorities, businesses which want to get the Bill carried out, local authorities and the Government. There is a good deal of good will on the part of the local authorities, judging from our contacts with them. It is in their interests to ensure that those who own well-set-up, prosperous businesses comply with the

Bill, because so much of the general prosperity of the community in the kind of areas about which we are thinking, and particularly the resort areas, depends upon them.
We are providing, as I shall remind the House again in a moment, that the finance for this loan scheme shall come out of the key sector and not out of other local authority moneys. This will give greater certainty to local authorities in making advances and is a change from the arrangement when the Bill was first before the House. I remind the House that we have given this small amount of elbow room of ¼ per cent. above the Public Works Loan Board rate of interest in order to make sure that there is no reason for the local authorities to hang back on that account.
We have made some—and we are making one more this evening—easings of the mechanics for granting loans. Lastly, as soon as we can we shall issue administrative guidance to local authorities on how we propose that the Bill, when it becomes an Act, should be applied. We shall make clear to them the concern of both sides of the House that there should be no delay in implementing the Bill and our wish that loan applications should be dealt with as quickly as possible.
Looking ahead at the whole prospect when the measure is on the Statute Book, I suggest that it adds up to a fair sized package of incentives and encouragement to local authorities to play their full part in carrying out the intentions of the House. I mention those two things as background to these amendments, and I shall now deal with them as quickly as I can.
There were doubts at the earlier stages—I have in mind my hon. Friend the Member for Folkestone and Hythe (Mr. Costain)—whether the loans scheme would be of significant benefit to hotel and boarding-house keepers in a small way of business who held premises under a short lease or a lease due to expire in a few years' time. In the original wording of the Bill, under the terms of Section 36(2) of the 1971 Act, which would apply to the new loan scheme, any loan made by a local authority would have to be secured by a mortgage of the applicant's interest in the premises. Obviously, the value of the lessee's remaining interest in a lease shortly to expire would be quite


small and accordingly this might restrict the amount of any loan he might hope to obtain.
In an effort to deal with this point, the hon. Member for Norwood (Mr. John Fraser) moved an amendment in Committee which was similar to the amendment he has now tabled a Report.

Mr. John Fraser: It is almost identical.

Mr. Lane: The main effect would be to secure a loan to a short-term leaseholder by means of a compulsory charge on premises to involve the freeholder's interest as well as that of the leaseholder.
The hon. Gentleman in withdrawing the amendment in Committee asked us to consider whether, as an alternative, the provisions of Section 28 (3) of the 1971 Act might be written into this Bill to enable the leaseholder to apply to the court for an order giving directions about the sharing of the cost between the leaseholder, the freeholder and anybody else with an interest in the relevant building. I have looked carefully at this suggestion, but I am advised that it would be outside the scope of the Bill. Even if this were not so, I would hesitate to introduce into a commercial situation a remedy which had been devised solely for housing.
There are wider issues involved in a proposal of this kind which go outside the content of the Bill and which would need fuller examination. Why should a concession of this kind be limited to small businesses? Why should not larger businesses have the same right of recourse to the courts?
At the same time I have been anxious to see whether we could find some other way of helping this kind of leaseholder, and when last week I had consultations with the local authority associations a proposal came up which is embodied in the amendment which I now commend to the House.
We began with the idea that it might help the leaseholder if the local authority were to be given discretion to accept some other security instead of or as well as the leaseholder's interest in that premises—which is the only security permitted at present under Section 36 of the 1971 Act. Short of compelling the freeholder to be joined in the transaction,

our idea was that the local authority, the freeholder and the leaseholder might be able to come to some agreement about security for the loan which the local authority might be empowered to recognise, or perhaps in some cases the leaseholder could offer some other form of security altogether which would be acceptable to the local authority.
The local authority associations—and we appreciate the help they have given to us—accepted this idea in principle, but pointed out that any amendment of Section 36 designed to achieve this idea would cause confusion with the scheme at present contained in that section which was closely modelled on Section 57 of the Housing Act 1964. Therefore, the local authority associations proposed—and I was glad to agree to this—that, instead, we should write into the new Bill a self-contained scheme, first to give wider discretion to local authorities in the matter of security, and, secondly, to simplify for the purposes of this Bill the loan scheme set out in Section 36. That is what the amendment is designed to achieve.
It may seem in wordage to be a long amendment. Its main features will be clear when they are compared with Section 36 of the principal Act. The new subsection (2) in form and in substance is very like Section 36(2), except that the local authority may accept any security or guarantees and not merely the applicant's interest in the premises.
Secondly, provision is made for the local authority to specify its own terms in respect of the loan. That means that subsections (3) and (7) to (9) of the original Section 36 are now unnecessary. The new subsections (3) and (4) reproduce the necessary provisions about rate of interest, which, with the amendment accepted in Committee, will be the Public Works Loan Board rate plus, at the discretion of local authorities, ¼ per cent. That is the lowest rate at which local authorities could cover their costs. The idea of a lower rate, or no interest at all in some circumstances, which I know some of my hon. Friends have in mind, is out of the question within the limits within which we have had to cast the Bill. The new scheme has the great merits of simplicity and flexibility. It also has the advantage of making the Bill largely self-contained in a way that it was not before.
It is clear that the local authority associations' proposals for an amendment along these lines is further proof of their co-operation in the loan scheme that the Bill introduces. I am grateful to them for their help.
I was also glad to have the opportunity last week to meet representatives of the associations, as I undertook in Committee to do, so that I could explain clearly to them that the Government were extremely anxious that the scheme should be effective.

Mr. Julian Ridsdale: Has my hon. Friend met any of the guesthouse proprietors who have been affected?

Mr. Lane: I have met some in one or two individual areas particularly concerned. I think here of Brighton and Blackpool. I have not met central organisations. I am not minimising that there may still be difficulties in practice. But we have gone a long way in the Bill, within its narrow limits, to try to meet those difficulties.
Although it is late, I have taken some time because I hope that the reminders I have given of the various encouragements to local authorities to work the scheme and the small but valuable changes we have been able to make will meet a number of anxieties that the small businesses have felt. We have been most anxious that they should.
Apart from the additional quarter per cent. interest rate to be charged at the discretion of the local authorities, the representatives of the local authority associations that I met last week particularly welcomed the news that the new loan scheme will be financed from the key sector and not out of the general pool of locally determined resources. This is another step forward, an extra guarantee that money will be forthcoming at this rather lower-than-commercial rate of interest that we are providing. The representatives added that while they could not speak for any individual local authority they considered that the scheme as we are now modifying it should be generally acceptable.
On that basis, and with this reminder of the totality of the provisions of the Bill, I commend the amendment to the House.

12.45 a.m.

Mr. John Fraser: We welcome the amendment in that it goes a little way towards what was wanted by the Committee. If they wish, local authorities may make loans available to guest house proprietors at the Public Works Loan Board rate. Apart from that, I imagine that the hon. Member for Bristol, North-East (Mr. Adley) wishes that he had the courage of his own connections, by which I mean his connections in the hotel and boarding-house trade, in that he pressed upon the Committee the need for mandatory loans by local authorities. The hon. Gentleman extracted a good many half-promises from the Under-Secretary, but at the end of the day he does not appear to have got very far.

Mr. Robert Adley: I asked my hon. Friend the Under-Secretary in Committee for assurances of meetings with the Department of Trade and Industry, the Treasury and the Home Office. Having received my hon. Friend's undertaking to that effect, my hon. Friend the Member for Hove (Mr. Maddan) and I withdrew our amendment. The undertaking has been met thoroughly and with the best of good will. They have been to the entire satisfaction of representatives of the industry.

Mr. Fraser: That may be so, but the amendment which the hon. Member for Bristol, North-East pressed in Committee has not got very much further.
I agree with the Under-Secretary that it is urgent to make progress with the implementation of the 1971 Act. I have said as much time and time again. Far too many premises in the country are at risk. However, I do not think that the Bill will help very much. In the main, it is a matter of whether proprietors are prepared to do the work, and the main impediment is not a shortage of money.
I welcome the provision in the amendment that guarantees can come from the freeholder where there is a conflict of interest between the lessee boarding house proprietor and the freeholder. But I know of no case in my experience where the freeholder has been willing to give undertakings to meet the lessee's expenditure. We are not living in a real world


if we imagine that this will happen. I hope that it does, but I doubt it.
In Committee, I withdrew my amendment on the understanding that the Under-Secretary would look at the possibility of applying the provisions of Section 28 of the Fire Precautions Act 1971 to boarding houses as well as dwelling houses. I do not want to say very much about my amendment except that the new clause, which is out of order, rather better embodies what I wanted than the amendment which is in order.
A boarding house or hotel proprietor may have a lease with only five or six years to run. He may face very heavy expenditure. We all know that in a real world the benefit of the expenditure will accrue to the landlord. It may be that when the lease comes to an end the landlord will serve notice under the Landlord and Tenant Act 1954 and grant to the former lessee a new lease at a rack rent. Nothing in law prevents the freeholder not only charging an economic rent for the premises when the lease ends but also charging a rent reflecting in part the expenditure met by the lessee boarding house proprietor. In those circumstances, it is wholly unjust that the lessee proprietor should be required to meet all the expenditure.
The point can be met adequately by applying the provisions of Section 28 of the 1971 Act to hotels and boarding houses, and that is the essence of my amendment. I am sorry that an amendment which says that directly instead of obliquely is not in order. But I am sure that it is not beyond the wit of the Government to find a way round the difficulty.
It is regrettable that it has not been possible to provide that where the freeholder has the benefit of expenditure he should be made accountable by a county court, on application by the lessee, for a proportion of the expenditure.

Sir Fitzroy Maclean: I was not on the Committee which considered this Bill but I have studied the Bill, as it has been amended, and the proposed amendments. I have listened to the Under-Secretary with a feeling of continuing disappointment. I welcome the Bill because it shows that the Government realise that there is a

problem. Unfortunately in practice the Bill does precious little to resolve that problem. A loan on the terms provided for does nothing to help—nothing that could not have been done by borrowing from a bank. What the Government must realise is that depending on the interpretation and application of the Fire Precautions Act, and we can judge that only as time goes on, it could spell doom for a lot of the smaller and older hotels and boarding-houses.
I represent a constituency which is literally full of such establishments. I run one, too, and I declare my interest. This means that I am very much alive to the problems involved. Naturally no hotelier worthy of the name, large or small, wants to run a hotel that is a fire trap. They all recognise the need for sensible fire precautions.
Equally, the average small hotelier, especially in the rural areas of Scotland, the area with which I am concerned, is not made of money. He will probably have a short season of six months or so, during which he takes little money. For him suddenly to be confronted with the necessity of finding perhaps several thousand pounds for structural alterations—and it is not possible to get a great deal done for that money nowadays—which in many cases will actually detract from, or will certainly not add to the assets of his hotel, means nothing short of disaster.
As the functionary who inspected my hotel three years ago said with a merry laugh when he went away, "This will put a lot of small hotels out of business altogether." I cannot believe that this is the Government's objective. The small hotels play an important part in the tourist industry which makes a vital contribution to the economy. The Government should help the small hotel. A loan at 10 per cent. will be of little use. What is needed is either a system of outright grants, or failing that, a provision allowing the cost of whatever structural alterations are called for to be charged against tax in the year during which they are made. Such measures are evidently outside the scope of this Bill but I hope my hon. Friend will use his influence with the Chancellor of the Exchequer to induce him to put the appropriate clause or clauses into the next Finance Bill.

Mr. Ridsdale: I support what my hon. Friend the Member for Bute and North Ayrshire (Sir F. Maclean) has said. In my part of the world the holiday season is short and this Bill will do nothing to help hotel-keepers make a profit. It is said that we must not look gift horses in the mouth. Despite the hard work done in Committee by my hon. Friend the Member for Bristol, North-East (Mr. Adley) and others, I still join with my hon. Friend the Member for Flint, West (Sir A. Meyer) in saying that it is a broken-winded old nag of a Bill.
It does nothing to allay the fears of guest house proprietors. Does the Minister understand the kind of charges they are facing as a result of the Fire Precautions Act 1971—which I want to see implemented as much as he does? The authorities are just beginning their assessments under the Act in Clacton on Sea and they are beginning in Agate Road because it begins with an "A". The houses are simple guest houses with hardly more than two storeys and they certainly could not be classified as being of moderate height. A person could quite easily jump out of the top storey and probably not break any limbs. Yet one house faces a charge of £3,000 and another a charge of £1,000. Another has had such a high charge put upon it because of fire precautions that it has decided to close down.
Yet on Second Reading the Under-Secretary said:
The fire service is well aware of the need to take all circumstances into account including financial circumstances, and I want to dispel any notion, if such remains, that its approach will be rigid and inflexible."—[OFFICIAL REPORT, 23rd January 1973; Vol. 849, c. 355.]
When I met these guest house keepers over the weekend and asked them how the assessments were made, they were nervous that they had been handled in a rigid fashion. These are family businesses catering for the lower wage earners. They are dependent upon a short season. Not only has the 1971 Act put them into debt but they have to face the interest rates proposed by the Home Secretary in the Amendment. With interest rates from the Public Works Loan Board at around 10 per cent. it could mean in the long term an outlay of £3,000 to meet the requirements of the Act and interest rates of a similar amount. Is it a wonder that

the guest house proprietors are in despair?
I have a letter from one of them which reads,
Anyway, I suppose there is always the mental home. That is something I shall certainly be eligible for, along with many other hoteliers who are in a small way of business, of course. Perhaps it is a blessing to have been chosen first in Clacton to get the fire precautions work done. There will be such a queue for the mental home soon.
Yet the Under-Secretary said
A point which I stress particularly for many of my hon. Friends is that as we are dealing with a predominantly holiday industry the fire authorities want to phase their programme so that any work will fall to be done out of the season, where this is possible without undue risk to the public. For many of the proprietors of the smaller premises the chances are that it will be some time before they are faced with any expense."—[OFFICIAL REPORT, 23rd January 1973; Vol. 849, c. 356.]
Already one of these guest house proprietors is having to close down because of the charges. I am sure that is not what my hon. Friend intended. Is the amendment the most we can expect from the Home Secretary? Inevitably on occasions like this when local authorities are made to do central government work there is the proviso that the local authority can charge at a rate ¼ per cent. higher for the trouble of doing the work so that a charge does not fall upon the ratepayers. But is it not absurd that it ever should? Here central government, through the Fire Precautions Act, are putting obligations on to local government which could continue for some time rather than simplify the procedure and accept responsibility through the Treasury, seeing that no charge falls upon the ratepayers. Yet what has been noticeable on Second Reading, in Committee and now is the complete absence of any Treasury Minister, although this appears to be a Treasury measure.
In defence of what he was doing, the Under-Secretary in Committee used the argument that if the rate were put at ¼ per cent. above the Public Works Loan Board rate the ratepayer was saved extra expense. I only wish that some of his Government colleagues would feel like that when putting the huge educational burden on the ratepayers. My hon. Friend must know that this is a paltry sum compared with the charges the ratepayers already have to meet. It


is small because in Essex these proprietors, in addition to having to face interest of anything between £100 and £300 a year, face rate increases of 25 per cent. in the present year, and that does not even allow for revaluation.
I hope that my hon. Friend will undertake to look again at the Bill in another place. An Amendment signifying how I feel has not been called, but the Government should do far more than they are doing. The previous Government gave help to the hotel industry. In Committee the present Administration gave such help to the big hotels but have not been prepared to extend it to the small hotels. They have not done nearly enough to help these small guest houses and hotels which are facing charges in addition to those caused by the Fire Precautions Act.
I ask my hon. Friend to do something more than has so far been done, as otherwise in constituencies that have a short season some of our small guest houses and hotels, because of all these charges and the high rates, face being forced out of business, which I am sure neither my hon. Friend nor the Government want.

Dame Irene Ward: I did not have the pleasure of being a member of the Standing Committee. If I had, I should have started at an early stage saying what I thought about such a provision as this. As it is, I understand that my hon. Friend made some complicated arrangement, which no one seems to know will prove satisfactory, to meet an amendment on short leases moved by my hon. Friend the Member for Folkestone and Hythe (Mr. Costain), but never said a word about the situation of people owning guest houses and small hotels. The fact that such people have acquired those businesses by using their savings seems to have passed the Minister completely by, and the whole position is most unsatisfactory.
I remember that when we had that magnificent deputation to the Treasury the Minister was obviously shocked, because I do not think he had intended to do anything at all. He is a charming man, but on this occasion he displayed no charm. He was shocked by so many

people being in the deputation. We made our position plain, but to no effect.
I should like to know which local authorities the Minister saw. I have great admiration for some local authorities and none at all for others. I want to know the names of the local authorities which the Minister saw—but not a bit of it. He talked about "local authorities", which might be local authorities which know nothing about small hotels and boarding-houses. Some large authorities have no notion of the problems of people who live on small incomes from boardinghouses which they have started with their own savings.
I understood that there was to be a special meeting with the same Treasury Minister to argue the matter out before a decision was reached tonight. I was horrified to hear that the meeting was to take place after we had dealt with the Bill.

Mr. Lane: It might save time if I were to clear up this matter now. The purpose of the wider meeting which we are hoping to have soon, which will include a Treasury Minister, is to discuss the wider problems of hotels and boardinghouses, not merely those arising from this narrow Bill. We are going ahead with the Bill tonight on the clear understanding that the wider meeting will take place for the various purposes my hon. Friends have in mind as soon afterwards as can be arranged.

Dame Irene Ward: That sounds very nice, but I have not been told about that and I like to know where I am. My Whip told me that there would be a meeting, and it was difficult to fit in. Obviously, it was never meant to be fitted in.
I am interested in fire precautions and the effect of the Bill on boarding-houses and small hotels in my constituency. I feel that I have been done, and I do not like being done. I have not been told about the wider issues, and I have had no representations on them from small boarding-house keepers in my constituency.
I listen to debates on big issues with interest and sympathy. The Government seem to be more interested in bigger issues. They are important, but so are the small issues, which always go to the


bottom of the pile in Cabinet and ministerial meetings. Small things matter very much. It is Conservative philosophy to want to help people who try to stand on their own feet. Certainly a lot of these small hotel and boarding-house keepers stand on their own feet. But one cannot raise money at the drop of a hat, and all these people have to meet increases in rates and all sorts of things.
The Government are rightly trying to help, but when we ask for something for a specific group we do not get the sort of sympathy which is necessary. Are we to have a meeting before another place gets the Bill? I want to have another go at the Treasury. I am devoted to the Treasury really but it is so busy that it does not think about small people. We are in a deplorable situation, as I know because I have above the average proportion of retired people in Whitley Bay, the part of my constituency where there are so many small hotel and boardinghouse keepers.
Why cannot my hon. Friend see the people who represent the small hotel and boarding-house keepers? I do not like being represented by enormous bodies, because they lose touch. Can we have a meeting with a Treasury Minister at which the small people can really state their case? That is all I have to say at this hour, but I think that my hon. Friend could have come along with something more than just talk about leaseholders. I hope that my people will be there for life. It is not just a question of short leases.
I feel thoroughly dissatisfied. I have a suspicious nature and I imagine that, with the Bill being put on so late at night, the Minister thought that not much attention would be paid to it. But the people we are representing here ought to be protected by a Conservative Government.
If I do not get something better than this, I shall tell the whole Government when they are here of my dissatisfaction with one interpretation of Conservative philosophy. I hope that my hon. Friend will put that into his head and realise that the battle is not lost, because we shall fight on and on and on. I do not suppose I shall be here for another 10 years, and it usually takes 10 years to win a battle in this House, but it would be a good thing now if my hon. Friend were to show

more sympathy and not just talk about a small section of the industry by which he thinks he has done very well. He may have done, but he has not done well for the majority of the people in whom we are interested in this context.

1.15 a.m.

Mr. Norman Miscampbell: One welcomes the change which has now been made to allow security to be raised for loans, not only for leaseholders but for freeholders. It is a step forward.
Criticism has been made of my hon. Friend the Under-Secretary of State and others that they have not taken an interest. I know from my personal experience that they have taken a deep and enduring interest in the matter. My hon. Friend the Under-Secretary has taken the trouble to talk to hoteliers with great care about the problems they are facing.
We have also to recognise that the Bill has to provide for loans. The campaign which many of my hon. Friends wish to conduct tonight is one which we should be conducting when the Budget comes and not on this Bill. If we argue tonight for grants, we must remember that the original Act provided for loans and that the Bill takes that one stage further and arranges for those loans to be made.
Having said that, it is worth remembering the difficulties in which a number of our boarding-house keepers find themselves. I do not take quite such a pessimistic view as some of my hon. Friends. Those who have to find thousands of pounds for refurbishing or making their big hotels safe from fire can probably find the money, but I have a much clearer picture of those in difficulty in finding a few hundred pounds, those with 14 or 15 bedrooms. It is worth remembering the kind of figures on which those people are working.

Sir F. Maclean: Does my hon. Friend realise how little one gets done now for £1,000 in building? That is what we have to remember.

Mr. Miscampbell: I not only realise it. I have been to dozens of Blackpool hotels in the last six months looking at what can be done at every door and window, and looking at estimates. I appreciate it very clearly. Of course I


sympathise with those who have to find thousands, but the overwhelming problem we have in a place like Blackpool is of much smaller sums which many have to find and their difficulty in finding them.
Ten years ago the average Blackpool hotel or small boarding-house was providing bed and breakfast at the unbelievably low figure of 18s. per night. Today—I translate into new money—they provide the same kind of holiday for working-class people at £1·25 or £1·50. For full board, they are doing it for £2. It is a considerable burden to try to find between £300 and £500 for fire precautions from that kind of figure.
It is easy to say in the House of Commons that we should have these new fire precautions, and we know that we should. We know what a horrifying situation there would be if anybody was caught in a fire in a hotel in Blackpool or in any other resort. It is our proud record in Blackpool that nobody has died in such a fire in living memory. That may be luck but it is the case.
Clearly a change in fire precautions law must be made, but the ordinary small person with, as the hon. Member for Norwood (Mr. John Fraser) pointed out, a lease with three or four years to go is faced with a problem in finding £300 or £400 to make a change which Parliament rightly feels should be made. I make no bones about it: I wanted a grant, a grant limited to a quite small figure. I thought that if a grant of £200 or £300 was made in every case, this would cope with the smallest boardinghouses which have to face the most difficult problem and that the larger hotels could no doubt finance themselves.
However, the fact that I want a grant and advocate a grant cannot be pursued in the House tonight, because the Bill is not the occasion for doing that. I should like to urge my hon. Friends to save their ammunition for the occasions on which we can do that, at Budget time or in urging matters upon Treasury Ministers and on other occasions. They are the occasions when we can get a grant. We cannot get a grant out of the Bill.
I have mentioned the difficulties of the smallest boarding-houses. I recognise

that the Government have paid considerable attention to them. I welcome the fact that we now have a loan scheme as a final long-stop to help. I thankfully accept what we have got today. Nevertheless, on the appropriate occasion I should like to fight to make sure that we get the grant which we should have.

Mr. Adley: I would say to my hon. Friend the Member for Blackpool, North (Mr. Miscampbell) that it is just because a large number of us went to the Treasury nearly a year ago and fought the battle we are now fighting, to try to provide help for the small hotel keepers, that we are here tonight. It is perhaps not coincidental that almost a year has passed, and the measure that the Treasury promised has turned out to be something of a damp squib. But this time we are fortified in our renewed attacks on the Treasury by the knowledge that our fears were justified. It would not perhaps be inappropriate to warn the Treasury—in the absence, yet again, of a Treasury Minister—that this time we shall want real assurances, before action through the passage of the Finance Bill, that action will be taken to help small hotel keepers.
My hon. Friend the Under-Secretary has been put in an intolerable position. With all the sincerity I can muster, I should like to say that he has been superb in every way in trying to help those of us who have gone to him in the last few months. He has done everything he possibly could. What has become increasingly clear is that the Bill which was provided is simply not the vehicle we thought it would be and were led to expect when we had the meeting at the Treasury nearly a year ago, to which my hon. Friend the Member for Tynemouth (Dame Irene Ward) referred.
This time we must make sure that the Treasury does not palm off on to the Home Office the work it should be doing and should have done in the first place. Perhaps it was our weakness in the first place that has put my hon. Friend in the extremely difficult position of having to face a barrage of criticism from his backbenchers and the invidious position of being unable to do what I feel he knows is necessary, because of the impotence of our legislative processes.
Once again I declare an interest in the hotel industry. What saddens me is that


my interest, which is with a large hotel group, shows me that unfortunately, not for the first time since I have been a Member of the House, and under both the previous Government and the present Government, we seem to be able to take action which can make life easy if not attractive for the big organisations, be it the British Steel Corporation, the British Aircraft Corporation or Hilton Hotels, yet we seem totally unable to find any means of helping those who really need assistance.
With no disrespect to Hilton Hotels, it is a little silly that that organisation is to receive £600,000 of public money to build a hotel in Shepherds Bush when we cannot find £200 for a small hotel keeper in Blackpool, Clacton or Bude who wants to continue in business in the way to which he has been accustomed over the years by providing a service for people on low incomes. Surely this cannot be right. Surely no Government in their right minds could have that intention. It must be up to those of us who are trying to help the small hotel keepers to ensure that we succeed in doing so.
My hon. Friend the Minister has produced a further amendment tonight. He is bending over backwards to help. The fact that the loans under the Bill are to come out of a key sector is a further indication of his sincere attempt to help the small hotel keeper. But there is a limit to which he and the Bill can go. My hon. Friend says that it is out of the question, within the limits of the Bill, to do a number of things that his hon. Friends want him to do. He referred to narrow limits, and that is the whole point. It is the narrow limits of the Bill which have shown us that the amendments we have sought to press, however hard we had pressed them, would not have achieved the objective which we all sought.
It is slightly ironic that we should have started this debate late at night, after the Report stage and Third Reading of the Coal Industry Bill. Some quick mathematics in the Library has shown me that, in the 2½ years since June 1970, the House has spent 56 hours discussing coal mining and 3½ hours discussing tourism, nearly all of which has been time gained by back benchers on Adjournment debates or through dis-

cussion of this Bill, which itself resulted from pressure by back-benchers.
I am in some difficulty. I do not want to speak for too long, because other hon. Members who have sat here for many hours wish to speak, and we all want to get home, but there are one or two points that I must make.
The British Hotels, Restaurants and Caterers Association has expressed, through its chief executive, the view that the Government are not totally aware of the problems of the industry. There is a reference to this in a speech he made at the hotel and catering industry conference in Scotland a couple of weeks ago.
The Development of Tourism Act, which the last Government passed, is closely related to what we are discussing. I hope that my hon. Friend—again, I feel sorry for him, because it is not the responsibility of his Department—will impress on the Department of Trade and Industry how important it is that registration and classification be brought in as part of that Act so that he, in the Home Office, may know the extent of the effect that Acts like the Fire Precautions Act will have on the small hotel keeper. Even he has no idea of the size of the problem because no one knows how many small hotels there are in this country, and we will not know until the Government summon up the courage to implement Part III of the Development of Tourism Act.
With the passage of time, my hon. Friend the Member for Harwich (Mr. Ridsdale) says, he has just got to the letter A in Clacton. By the time he gets to the Ls, Ms and Ns, a large number of small hotels will have been forced out of business. It will be a slow and painful death for many of them. We have to do something; we cannot just sit by. I stress, in an aside to my hon. Friend to the Member for Blackpool, North, that this affects not only resorts but towns and cities all over the country. If we do not do something quickly, we will have to sit by impotently while many hotels go out of business.
1.30 a.m.
So that I shall not be accused of talking idly without facts, I should like to refer to the Scotsman of Monday 22nd January. A 23-bedroom hotel at North


Berwick, East Lothian—the 80-year old Imperial Hotel—was forced to close because of the cost of complying with the new fire safety regulations. The Scotsman said:
It is the first known 'victim' of the new laws…Mr. Frank Mickel, the manager, said that the cost of bringing the hotel up to the fire regulations standards would have been about £20,000. It would have taken them ten years to recoup this money, he said, so they decided to convert the hotel into flats.
My hon. Friend was asked whether he had had consultations with the industry. Very fairly he pointed out that he had been to Blackpool and to Brighton but had not been in touch with any of the industry's associations. Has my hon. Friend received any representations from the British Federation of Hotel and Guest House Associations which is based in Blackpool? I should like to refer to a letter which I received within the last few days from Mrs. Kathleen Harris, the general secretary of that organisation, who writes:
We are an organisation representing some 2,500 small hotels and guest houses, and naturally the Fire Precautions Act and its implications are causing us much concern on behalf of our members. I am fully aware that the Government has promised that discretionary loans will be made available through local authorities to hotels and guest houses to assist them in bringing their establishments up to the requirements of the Act, but this concession, I believe, will only be as a 'last resort'.
At our recent Annual Conference a resolution calling on the Government to make available grants in order to help alleviate financial hardship to hoteliers and guest house owners who are faced with high costs through compliance with the Act was carried unanimously by the delegates, but I am afraid that the Home Office categorically refused to consider our appeal on the grounds that they saw no reason to treat hotels and guest houses any differently to shops, works and factories etc.
After the Development of Tourism Act 1969 neither the Treasury nor the Home Office should be allowed any longer to get away with telling us that there is no difference between a hotel, a shop or a factory.
Mr. Clive Derby, the Chief Executive of the British Hotels, Restaurants and Caterers Association, has made urgent representations to the Chancellor of the Exchequer about the Fire Precautions Act. He pleads
that the total cost of expenditure on fire precautions should be allowed against the

profits of the accounting year in which it is incurred.
I do not think that is an unreasonable request.
I should like to draw to the attention of my hon. Friend a fact borne out to me today in a letter I received from my hon. Friend the Under-Secretary of State for Trade and Industry that, under the Government's counter-inflation regulations, hotels will not be able to increase their prices and that the Fire Precautions Act appears to be a factor which they will have to swallow. Not only can they not afford to have the work done—and they probably cannot afford to borrow the money—but they cannot now put up their prices to cover the costs. This is grossly unfair. Perhaps my hon. Friend will seek an opportunity to intercede with the Department of Trade and Industry on this point.
I again apologise to my hon. Friend the Under-Secretary for appearing to aim at him the darts and arrows which by rights we should be aiming at his right hon. and hon. Friends in the Treasury and the DTI. We appear to be back at square one. We have had a year in which we have learned a great deal. Possibly, like the Duke of York, we have been up the hill, we have reached the top and we had a Treasury meeting last year at which we thought we had gained a great success. We reached the bottom of the hill when we saw the Bill. I finish as I started by giving my hon. Friend a warning, which I hope he will pass on to his right hon. and hon. Friends, that we are about to start climbing the hill again.

Mr. Lane: I shall return to Amendment No. 4 in the names of the hon. Member for Norwood (Mr. John Fraser) and some of his hon. Friends after I have tried to deal with one or two other points.
I have never suggested—and I do not now suggest—that the Bill will act as a kind of magic wand to solve some of the difficulties that have been mentioned tonight, but I think that on the part of some hon. Members there is an excessive air of gloom and doom about the prospect facing the small hotel and boardinghouse keeper. I do not think it is right that that message should go out from the House. I am not minimising the difficulties. I have heard some of them. I


have heard, via a number of hon. Members speaking on behalf of their constituents, that there may be difficulties, but I deprecate so much talk about many people being forced out of business or that the Government are trying to force them out. That is not the case. The Bill will be of significant help to some of the smaller people in meeting the necessary costs of fire precautions in the interests of the public.
I hope equally that the message will not go out that anyone here would in any way connive at the continuance in business of hotels, of any size, which are manifestly a grave fire risk. I take the House back to the original purpose of the 1971 Act, and I stand by that.
My hon. Friend the Member for Bute and North Ayrshire (Sir F. Maclean)—and I appreciate the experience from which he was speaking—said that the Bill does nothing more than borrowing from a bank will do. The Bill is intended to provide last-resort facilities for those who would have difficulty in getting money from a bank, because we envisage a rate of interest appreciably lower than the rate charged by banks, and that will be of some help.
My hon. Friend said that small men are not made of money and that they may suddenly be faced with an expenditure of several thousand pounds. I hope that that will not be a normal experience for the small man. I agree that it depends on what size we have in mind—and different figures have been quoted—but I say to him and to my hon. Friend the Member for Harwich (Mr. Ridsdale) that if a small hotelier thinks that he is faced with an unreasonable list of alterations he can have resort to the Act which provides that the fire authority can require only what is reasonable, and that includes taking account of financial considerations. If anyone believes that the fire authority is being unreasonable he has a right of appeal to the courts about it.

Sir F. Maclean: Did my hon. Friend hear our hon. Friend the Member for Bristol, North-East (Mr. Adley) quoting the case of an hotel in North Berwick which had 22 bedrooms and for which the cost of adapting for fire precautions would have amounted to £22,000? My own hotel is about the same size as that,

and I assure my hon. Friend that an ordinary, run-of-the-mill country hotel of that size cannot find £20,000. If it borrowed the money from a bank, from a local authority or from anyone else it would find itself in the soup in trying to repay it.

Mr. Lane: I know of the North Berwick case. If an hotel of that size has to spend that amount of money, one is bound to ask about the state of its fire precautions. Is not that the very kind of place at which the Act is directed?
My hon. Friend the Member for Harwich mentioned the experience of Clacton and he spoke to me about this earlier in the week. If my hon. Friend feels that the fire authority is being over-rigid in its assessment, the matter can be discussed with the authority. The Act provides that anyone can apply to the magistrates' court if he feels he is being asked to do an unreasonable amount of work. I hope that my hon. Friends will make this known.
I do not feel that that case justifies the use by my hon. Friend of the phrase "despair for the small man". Let us try to keep this in proportion. Some will have greater difficulties than others. The Bill will give a significant degree of help.
My hon. Friend the Member for Tynemouth (Dame Irene Ward) complained that I was talking tonight, as I am, purely about a fairly narrow part of the Bill. She said that nothing had been said on behalf of the people who own their own businesses. With respect to my hon. Friend, the whole purpose of the Bill is to help the small people about whom she spoke so eloquently. It is deliberately tailored for the small business, not for the larger ones. It is their problems that we have in mind.

Dame Irene Ward: I was worried that, after all the powerful representation which had been made, action was taken only in respect of short leases and so on and that nothing had been done concerning the main argument which we started with the Treasury about a year ago. I remind my hon. Friend that I know exactly what the Bill stands for. I have not yet quite lost my memory, and I am sorry that he thought I had.

Mr. Lane: I am coming on to my hon. Friend's point. She will no doubt remember the memorable occasion—I regret that I was unable to be there—when a number of my hon. Friends went to see my hon. Friend the Chief Secretary. They are being a little unfair to my hon. Friend because in this Bill we are doing precisely what my hon. Friend on 10th July last year said we would do. I know it does not go as far as my hon. Friend would like it to go, but we have never made out that in this Bill we were going further than we have done. Therefore, I defend my hon. Friend the Chief Secretary against any implication that he promised something that we have not carried out.
My hon. Friend also asked which local authorities I had talked to. I spoke last week to representatives of all four local authority associations covering local authorities large and small, urban and rural. Therefore, in that sense I covered the whole field.
My hon. Friend also asked whether we could have a wider meeting before the Bill starts in another place. Because of the time factor I cannot guarantee this will happen, but I will tell my hon. Friend the Under-Secretary of State for Trade and Industry exactly what she said about timing. I hope that it will be possible to have this wider meeting, if not before the Bill starts in another place, before it finishes, but I cannot give an absolute undertaking. I do not think this matters because the meeting that we are trying to arrange is to discuss the wider problems of hotels, boarding-houses and the tourist industry and not mainly the Bill at all and it will take place as soon as we can fix it.
I was grateful for what was said by my hon. Friend the Member for Blackpool, North (Mr. Miscampbell). He promised a battle at Budget time and emphasised the difficulties faced by the small man.
Finally, I appreciate the remarks of my hon. Friend the Member for Bristol, North-East (Mr. Adley) but I assured him that this is not a damp squib measure. It is what in July we said we would do. At any rate, my hon. Friend has fired a shot across the Treasury bows and

the Treasury will take due note. I will draw the attention of my hon. Friend the Under-Secretary of State for Trade and Industry to what he said about registration. My hon. Friend also asked why there had been no consultation by me with the small man. We had thorough consultations during the drawing up of the 1971 Act and, so far as I know, that sector has not sought meetings with me about this Bill.
1.45 a.m.
On the question of the freeze, I think that what my hon. Friend has been told by my hon. Friend the Under-Secretary of State for Trade and Industry applies to the present situation, and what may apply in a few months' time is still open to further discussion.
I return to the amendment of the hon. Member for Norwood. Having heard his arguments again tonight, I cannot advise the House to accept the amendment, which goes rather further than we should go in the Bill. I still do not accept the hon. Gentleman's analogy with arrangements in housing. Another reason against the amendment is the question whether it is right to put that sort of compulsion on the freeholder. Why should he have to finance himself through a local authority loan and other means? We do not believe that it would be equitable to put that burden on him in precisely the way the hon. Gentleman proposes.
The idea of compelling other people to be associated with the expense of an enterprise of that kind we are considering seems not only wrong in principle but against the general approach of the 1971 Act, which was focussed on the occupier rather than the freeholder. We should not accept the amendment except as part of a much wider revision of the main 1971 Act. I shall be grateful if the hon. Gentleman will be willing to withdraw his amendment in view of those assurances and explanations.

Mr. Deputy Speaker (Sir Robert Grant-Ferris): Order. Only one amendment has been moved.

Mr. Lane: I hope that the hon. Gentleman is satisfied with that explanation, and that the House will accept my amendment.

Amendment agreed to.

Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed.

ADJOURNMENT

Motion made, and Question proposed, That this House do now adjourn.—[Mr.Jopling.]

NORTHERN IRELAND (AGRICULTURE)

1.47 a.m.

Mr. James Molyneaux: My reason for raising the problems of Northern Ireland's agricultural industry at this juncture arises from the fact that the common agricultural policy of the European Economic Community has just begun to apply, and it is right that the many constituents in almost every constituency in Northern Ireland who are affected should know that their anxieties and concerns are fully known and understood in London and Brussels. If there has been a lack of enthusiasm for EEC entry in Ulster one reason has certainly been the anxiety felt about the Province's agriculture.
In order to place the points I shall raise in perspective I must say a word about the special features of the industry.
Agriculture is the biggest single industry in Northern Ireland. It provides directly about 10 per cent. of the Province's employment and about a further 10 per cent. indirectly in processing and packing and so on. The sum of £200 million, or approximately 9 per cent. of the Province's total gross product, comes from agriculture.
But agriculture is a shrinking industry. There are still many small units constantly at risk, and there are crucial problems. Average net farm income is well below that in England and Scotland. Earnings are the lowest in the Kingdom. The area is climatically unsuitable for producing cereals, so a high proportion of feeds has to be imported. Hence transport costs on imports and exports play an alarming role in farmers' margins. Moreover three-quarters of Ulster's agricultural activity is in livestock and livestock products and is thus heavily dependent on imported food. By con-

trast, under half of England's agricultural activity is in these products. Though it may be true that the industry will have to shrink further, this is a very inauspicious time to lose any employment in the Province.
A final and unique problem is created by the fact that Northern Ireland is the only part of the United Kingdom with a land border with another member of the EEC. There is great concern to see that farmers in the Republic are not put at an advantage in relation to their northern colleagues because of the differences in their transitional arrangements.
It has long been recognised that Northern Ireland has a special problem of remoteness from her markets in the United Kingdom. At present the industry has a special grant of £1.75 million a year to offset export disadvantages—the so-called remoteness grant. This grant is due to end in 1974, and it is understood that the form of the grant may not he approved under EEC rules. However, if no substitute is found there will be very serious consequences for Ulster farms. I hope that my hon. Friend the Under-Secretary can give at any rate an indication that the Government will treat as a matter of urgency the need to give Ulster farmers an assurance that adequate help will be given if the remoteness grant comes to an end.
More than 80 per cent. of Ulster's feed has to be imported. Minimum import prices for cereals put Northern Ireland at a clear disadvantage because of transport costs. I understand that cereals will cost Ulster farmers up to £3 a ton more than farmers in Great Britain under full EEC conditions. The future of the pig and poultry industries or, to put it another way, of 14,000 jobs depends on finding a way of ensuring that Ulster farmers can obtain feedingstuffs at comparable prices with those paid by competitors in Great Britain. Government decisions have created these feed cost problems, and I hope that my hon. Friend will assure me that further decisions will ensure that they are solved, whether in London or in Brussels.
The future of the remoteness grant and the long-term feed cost problem lead naturally to the beef industry. It has been argued that Northern Ireland beef farmers have the greatest potential benefit to come from EEC entry, yet at present it is in


this sector that there is now grave concern about the future.
In the short term there are a number of uncertainties. The brucellosis payment is due to be phased out in March this year. There is uncertainty about the future of the remoteness grant after March 1974 and of other production grants under EEC rules. The supply of stores from the Republic has virtually dried up and a new supply has to be built up in the North in the next two years. All these factors have led to a feeling of uncertainty about the future. Profit margins on exports across one stretch of water appear to be at risk, let alone any margin which may exist for exports across two stretches of water to Europe.
On a more administrative front, there is apparently still great confusion about how the CAP intervention arrangements will work for beef. Perhaps the Under-Secretary can take action to see that those affected fully understand the mechanics.
A specific complaint which has been raised with me is the system for allocating licences for lorries carrying produce to Europe. Clearly, if the Northern Ireland beef industry is to have any chance of competing in Europe, it will be essential for Northern Ireland carriers to be in a position to offer a good package deal for transporting meat. I understand that at present there is an impression that the United Kingdom quota of such licences is being allocated inequitably in the case of Northern Ireland and that the shortage of licences is already creating difficulties for beef.
I turn to one or two items of EEC policy in which Northern Ireland has a great interest. There is much talk about Western Ulster and its economic problems. One of these arises from the large areas of marginal land which does not qualify for full subsidies because it is not in the hills. These areas are suitable for sheep and, more important, the production of store cattle. The special Northern Ireland Breeding Herd Scheme and the United Kingdom Beef Cost Scheme have been a great help. Can the Minister give an assurance that something like these schemes will continue? Can he also undertake to press for a

definition of marginal land in any new EEC schemes which will include, for example, the areas of Fermanagh, West Tyrone and South Armagh which at present are excluded from the hill schemes?
Since Northern Ireland agriculture has hitherto benefited largely from production grants geared to improve the structure of the industry and deal with special disadvantages, there would naturally be great enthusiasm for any proposals to persuade Europe to adopt this mechanism. Ulster farmers hope that the Government will bear in mind the special structure of past marketing practice which has functioned well in the Province when plans are being settled for the future of marketing in the United Kingdom as a whole. Perhaps my hon. Friend will comment on these points.
The egg industry throughout the United Kingdom is in difficulties and Northern Ireland egg producers want to make common cause with their colleagues. The Province's egg producers have not been recovering enough from their packers to enable any profit to be made. Feed costs are not being covered. Producers are being pressed by packers for payment of arrears and it looks as if many of the laying flocks will not now be replaced.
I hope no one in Great Britain is under any misapprehension that the special help afforded to Northern Ireland egg producers this year gives them any special advantage over their counterparts in other areas. Whenever a chill economic wind blows across any sector of the United Kingdom economy it becomes an icy blast by the time it reaches Northern Ireland because of transport and feed costs and related problems. This has been the case with egg producers and the special assistance may help to save some of the 2,000 jobs at risk, with all that that means in terms of Ulster's employment position. In any case there looks like being a substantial loss of employment.
I do not want to say much about milk at this point. The returns have decreased comparatively in recent months and I know that this sector of the industry is anxiously awaiting the result of the 1973 Price Review. Suffice it to say that the Northern Ireland milk producers have


virtually sunk back to the poor neighbour position they occupied in relation to their English colleagues a year ago.
The fact that 30 per cent. of production goes for liquid sales and 70 per cent. to manufacturing purposes—the reverse of the position in Great Britain—makes it inevitable that Northern Ireland milk producers will suffer as a result of Government policies consequent upon our entry to the EEC, particularly because of the low intervention price for butter. That leaves them most vulnerable to unfair competition from the Irish Republic. I hope that the Minister has this in mind.
I come to planning legislation. Considerable concern has been aroused among farmers about the new planning arrangements. It is understood that farm buildings are to be-excluded from planning control only if they do not exceed a certain area and meet other stringent requirements. I hope that the Minister will use his influence to ensure that the arrangements are suitable for farming in Northern Ireland, where development of farmyards takes place over long periods in off-peak spells when labour is available. If too bureaucratic an approach is applied to farm development, such development could cease entirely.
Ulster is not immune from the threat of land value increases, a problem now causing concern throughout the United Kingdom. There has been about a 350 per cent. increase in the last six years and if the current trend continues and the profitability of farming does not improve, the future for agriculture in the Province could be bleak. It is not just a question of return on capital invested. Rising land values mean a catastrophic tax imposition on smallholdings when they are sold or when they pass on at death. There is an urgent need for an examination of ways in which land being transferred for further use for agricultural purposes—for example from father to son or from farmer to farmer—could be shielded from the swingeing effect of these taxes. There are various ways of tackling the problem, for example by a concessionary rate of tax or by special tax abatements. The whole problem seems to need an urgent Government inquiry.
Will the Minister take another look at the position of the modified Land Rovers in the Province? The special needs of Northern Ireland farming make these vehicles more useful than elsewhere and the new licensing arrangements tend to make their cost prohibitive. In Northern Ireland there is much uncertainty about the future of agriculture. Entry into the EEC involves so many possible changes. Any reassurance that the impact of these changes is fully understood by the Government at Westminster will be warmly greeted in the Province.
Northern Ireland farmers have been greatly encouraged by the arrival on the scene of my hon. Friend the Under-Secretary. They have welcomed him as one who understands their difficulties and speaks their language and they respect him for the ability which hon. Members have long recognised. In our critical problems ahead we shall need all his help and all his sympathy.

2.2 a.m.

The Under-Secretary of State for Northern Ireland (Mr. Peter Mills): First I wish to thank my hon. Friend the Member for Antrim, South (Mr. Molyneaux) for his kind remarks at the end of his speech. I am also grateful to him for raising the important topic of agriculture in Northern Ireland because, amidst the sensational headlines which come almost daily from Northern Ireland, the good solid advances being made in many directions are only too often overlooked. Agriculture is an industry of vast importance to Northern Ireland and immense progress has been made in it in the last 50 years. Steady, encouraging, rewarding progress is now being made in spite of all the problems imposed by the troubles.
The tragedies of the last three years have had remarkably little effect on agriculture, except in certain respects to which I shall return later. So I very much welcome tonight's debate as being an opportunity to pay a strong and sincere tribute to all concerned with agriculture—the farmers, the merchants, the processors and the exporters—for the steadfast way in which they go about their business and for the hope that gives me for the future of Northern Ireland.
My hon. Friend semed a little concerned over farm incomes and profitability. Farm incomes in Northern Ireland have shared in the general improvement of farm profitability in the United Kingdom since 1967 and if my hon. Friend looks at the index base he will see that various sections of farms in Northern Ireland have progressed very well. Incomes on dairy cattle and sheep farms have continued to improve largely as a result of increased stock numbers and better market prices. Farms with substantial commitments in pigs and poultry have shared less well and it is only right to admit it. Broadly, however, I expect this pattern to continue in the current season.
My hon. Friend spoke of a shrinking industry. I hate to disagree with him but he is wrong there. It is not a shrinking industry. Numbers employed may be shrinking, but if he looks at the preliminary results of the agricultural census in December 1972 he will see the remarkable progress that is being made in production. To give just one illustration, the number of beef heifers in calf is up by nearly 50 per cent. This is a remarkable achievement. While the numbers of people on the farms may be shrinking, production is rising. But one has to look at the problem of employment, and I for one—and I believe that my hon. Friend will share the view—believe that it is important to try to manufacture and process as much as we possibly can in Northern Ireland so that perhaps people can be diversified from the farms to the processing industry. But it is a very healthy picture there.
For fat cattle and beef we have had high prices which have been very welcome to the farmers. Again, if one looks at the census I have mentioned, one sees that in the whole range of cattle there has been a very real expansion. I believe that there is a very good future for fat cattle and beef production in Northern Ireland. Certainly, as my hon. Friend has said, there will be a shortage of stores because the Republic of Ireland is holding on to more of its cattle and not so many will be exported on the hoof. Again, this means that we have to give every encouragement to the home producer in Northern Ireland so that this shortfall can be made up.
My hon. Friend said that not all farmers understand the intervention aspect. I can appreciate that, but that is a matter for the Intervention Board, which is giving details. I understand that leaflets will be prepared in order to make quite clear to farmers what it means. In the days ahead I shall certainly in my speeches go into this side of the matter in some detail so that farmers may be quite clear what intervention entails and what are its advantages.
The tendency is for a slight increase in the sheep herd. This is good and I welcome it. I hope that more sheep and mutton will be produced in Northern Ireland. We have good prices at present, with a ready demand. I am therefore keen to see expansion. and I believe that there will be real advantages in exporting the right sort of lamb to the Community. Therefore, as with fat cattle, I believe that there is a very good opportunity for further expansion, with prices which will be of real benefit to the farmers.
Milk is the backbone of most farming enterprises in Northern Ireland. A record quantity has been produced and there is every sign of this trend continuing in the future. There is room to replace foreign and Commonwealth supplies of butter and cheese. I admit that in the early stage the transitional arrangements appeared somewhat awkward, but I remind my hon. Friend that the intervention price of butter puts a very real floor on the market. It means, too, that there will be no dilution of prices to the farmer, and this is the first time we have had this provision. It is not as had as some people make out.
There is a real future for milk production in Northern Ireland, particularly when it is coupled with the increased value of calves and cull cows that the dairy farmer is enjoying. Only last week I went to a new cheese factory in Lisnaskea, which shows the confidence of the firm concerned in the future of milk and cheese production. It is not true to say that Northern Ireland is the poor neighbour of the United Kingdom. There is a real future for milk, and farmers through their calves and cull cows will be able to cover their increased costs.
My hon. Friend mentioned pigs, eggs and poultry. The position here is more


difficult because of the cost of imported feeding-stuffs—and this applies in Great Britain as well. I am aware of the problems of the egg industry. With the excellent Ulster bacon I believe that the prospects are good. As red meat is dear at present, the price of pig meat will rise and the pig farmer will get an adequate return.
The egg situation in the United Kingdom as a whole is difficult and arises from over-production. Chick placings have been reduced and the number of birds is less. That is already having an effect on the market. We have given certain aid to the egg industry. The poultry meat side seems to be going very well.
Looking at the various commodities in Northern Ireland, the message must be that we have to produce more from grass. That is in line with the EEC policy of the production of items for which the country is most suited by reason of its climate, soil and temperature. There is no doubt that Northern Ireland can produce grass. It has the right climate for it. Therefore, the production of milk, beef and mutton will go ahead.
My hon. Friend mentioned EEC problems. Ministers and officials have taken part in Brussels meetings and we shall be going there as often as necessary. So Northern Ireland is being, and will in future be, represented in Brussels. I attended a meeting in January when accession problems were settled, particularly those of compensatory amounts, and the outcome was not unsatisfactory.
Then there is the question of support by EEC institutions. It is not at present possible to say what proportion of agricultural support may become liable to be borne by EEC measures. The plain fact is that the common agricultural policy still has to be developed in many ways and whole sectors of assistance, such as aid for beef and for mountainous areas, are currently under examination in Brussels and the outcome has still to be reached. Our aim is to obtain the maxi-

mum benefits, and we shall see to it that Northern Ireland is not forgotten.
Obviously, Mr. Deputy Speaker, it would be out of order for me to talk about prices at present with the Annual Price Review in progress, because 1 cannot possibly anticipate its findings.
My hon. Friend mentioned remoteness grants and he is right in saying that £1,750,000 is given annually in this way. The three-year period closes at the end of the 1973–74 financial year, and the future of the grant after that must be renegotiated during the 1973–74 year. I am fully aware of the importance of these arrangements to Northern Ireland farmers and will bear in mind what my hon. Friend has said.
The House must remember the sensitivity of the EEC to regional aid of all kinds. I can give an assurance that the need for appropriate help is fully accepted by the Government, and it is a firm assurance. My hon. Friend mentioned transport to Community countries and I am aware of the problem. Indeed, it is a problem not just for Northern Ireland but for the United Kingdom as a whole. Discussions are taking place and I hope for a satisfactory outcome.
My hon. Friend raised one or two other questions about Land Rovers and land tax. Perhaps I can reply to them in writing to him, since I can then go into rather more detail than is possible in a few words now.
I believe that the picture as a whole is one of reasonable optimism, tempered with some doubts—

The Question having been proposed after Ten o'clock on Tuesday evening, and the debate having continued for half an hour, Mr. DEPUTY SPEAKER, adjourned the House without Question put. pursuant to the Standing Order.

Adjourned at seventeen minutes past Two o'clock.